RMD under SECURE Act

Its my understand the new age 72 RMD RBD is not required to adopted by a 401(k) plan - 

Assuming i am correct - Could a participant who would then be required to take their 401(k) RMD at 70 1/2 (plan rule) roll the funds (tax free) into a traditional IRA where they would have roughly 18 months before before having to take an RMD?

Thank you

What do you mean by not required to adopt? My understanding is you need to comply with SECURE in operation but you have until the end of the 2022 plan to adopt conforming amendments. You can still allow 70 1/2 to 72 withdrawals for folks who come in under new rules, they just are no longer RMDs in the IRS eyes so they would be eligible for rollover.

Did OP confuse age 72 RMDs in SECURE with the RMD relief in CARES that was optional?

45 minutes ago, RatherBeGolfing said:

Did OP confuse age 72 RMDs in SECURE with the RMD relief in CARES that was optional?

No.

5 hours ago, RatherBeGolfing said:

Did OP confuse age 72 RMDs in SECURE with the RMD relief in CARES that was optional?

The SECURE Act age 72 RMD provision is "optional" in the sense that a plan can still keep all its existing substantive RMD terms that apply at age 70.5 as a matter of optional plan design. Any distributions forced out between 70.5 to 72 would not be required minimum distributions, they would just be regular eligible rollover distributions forced out by discretionary plan terms (that happen to align in every respect with the RMD rules, except still tied to age 70.5 instead of 72). No distributions would be required minimum distributions until the participant reached age 72, at which point all subsequent distributions made under those provisions would be RMDs.

@EBECatty - Thank you - Question answered

On 2/4/2021 at 7:26 PM, EBECatty said:

The SECURE Act age 72 RMD provision is "optional" in the sense that a plan can still keep all its existing substantive RMD terms that apply at age 70.5 as a matter of optional plan design. Any distributions forced out between 70.5 to 72 would not be required minimum distributions, they would just be regular eligible rollover distributions forced out by discretionary plan terms (that happen to align in every respect with the RMD rules, except still tied to age 70.5 instead of 72). No distributions would be required minimum distributions until the participant reached age 72, at which point all subsequent distributions made under those provisions would be RMDs.

Yea that makes sense, thanks!