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Update Lifetime Planner to Reflect Changes to IRA Handling due to SECURE Act
Scooterlam
SuperUser ✭✭✭✭✭
The SECURE Act, recently signed into law, makes some important changes to retirement plans. There is one, maybe two changes found in the ACT that impact Lifetime Planner. These changes only apply to the US Quicken version.
1. The Act moves the age required to begin RMDs from 70½ to 72 - For sure a change needed in LTP. Ensure that both current retirees and future retirees are considered in the update.
2. The Act allows IRA contributions after 70½ - Maybe a change needed in LTP? I haven't yet tested if there are age limitations imposed in Quicken re: contributions.
Are there other parts of Quicken impacted? Tax Planner?
Please vote!
1. The Act moves the age required to begin RMDs from 70½ to 72 - For sure a change needed in LTP. Ensure that both current retirees and future retirees are considered in the update.
2. The Act allows IRA contributions after 70½ - Maybe a change needed in LTP? I haven't yet tested if there are age limitations imposed in Quicken re: contributions.
Are there other parts of Quicken impacted? Tax Planner?
Please vote!
37
Comments
So ... Quicken may be waiting until the new life expectancy tables are official before any changes are made to LTP. That would be understandable and prudent. I do hope this is on their radar screen with or without an Idea thread! Nonetheless, please vote!
For a deeper dive, I found the following Kitces article interesting on the subject, albeit 11 months old.
https://www.kitces.com/blog/irs-proposes-new-rmd-life-expectancy-tables-to-begin-in-2021/
In the article, was interesting to read this:
"Specifically, according to data provided by the IRS, of the Americans who are required to take distributions from retirement accounts, only roughly 20% are taking no more than the minimum required. Which means that the remaining 80% are taking more than the required minimum, thus making any decreases in RMDs a moot point."
YMMV in your own retirement plan. So maybe for most LTP users it is also a moot point? That is no or little affect on the plans ending balance?
But despite the above quote, I would still expect Quicken to timely update the model when new tables are approved.
Thank you for taking the time to visit the Community to post your question.
I have moved your post to the ongoing Idea thread to update the Lifetime planner.
Be sure to navigate to the top of this post and click the up arrow to add your vote!
Ideas are reviewed by our development team to see what people would like to be available in the future.
Thank you,
-Quicken Tyka
Please vote, if you haven't already done so.
IMO, there were two separate things at work, BOTH of which may impact your LTP results:
- The RMD age change (70.5 to 72) brought on by the Secure Act, and
- An executive order that the IRS life expectancy tables be reviewed and revised (last done in 2002!).
The latter is now complete and should be used beginning January 1, 2022. Snippets of the two tables are shown below for reference.I think that now, Quicken has what it needs to make these changes in LTP and not wait until 2022 or beyond. The law is in place and the life expectancy tables are now updated. AND....because this is part of Quicken's LTP model, it must be implemented timely.
One last note. As I understand this change, Quicken will need to address two scenarios where:
- the user is already taking RMDs under the old law and tables, and
- the user is going to take RMDs under the new law and tables.
How much of an impact for you? YMMV.Pre-Secure Act
Post Secure Act
Federal Register Announcement
https://www.federalregister.gov/documents/2020/11/12/2020-24723/updated-life-expectancy-and-distribution-period-tables-used-for-purposes-of-determining-minimum
is there some place where the actual RMD calculations are displayed,
vs just the overall summary numbers
when you click on a specific year bar in the graph.