News Archive

"The SECURE 2.0 Act added this penalty exception, which is effective for distributions after December 29, 2025. Participants must provide a long-term care premium statement to the plan sponsor in order for the distribution to be qualified. The distribution will be qualified as long as the premium paid does not exceed the lesser of $2,600 (for 2026) or 10% of the participant's vested account balance."  MORE >>

May 21, 2026. "Attach to Form 1040, 1040-SR, 1040-NR, or 1041.... If you only owe the additional 10% tax on the full amount of the early distributions, you may be able to report this tax directly on Schedule 2 (Form 1040), line 5, without filing Form 5329."  MORE >>

"As workplace retirement plans consider options to support retirement income, individuals may be asked to make choices that involve tradeoffs between control over their money, access to funds, fees, and legal protections.... This study reveals people's values and interests by exploring how they respond to different retirement income options in workplace retirement plans and how their views change when key features and limitations are made explicit."  MORE >>

"[Notice 2026-33] stated that 'no distribution will be treated as a qualified long-term care distribution unless a long-term care premium statement with respect to the employee has been filed with the plan.'... As a safe harbor, plan administrators are explicitly permitted to rely on the carriers' long-term-care premium statement to verify that: an issuer disclosure was made to the Secretary of the Treasury by the provider of the long-term-care coverage; the insurance is certified; and the premium amounts are correct."  MORE >>

"The guidance applies to clients with 401(k) plans and other defined contribution retirement plans. Sponsors can choose whether to offer the LTCI payment distribution option. Eligible clients can use at least $2,600 of the assets per year to pay for LTCI coverage without paying an early distribution penalty."  MORE >>

22 pages. "This notice provides guidance on qualified long-term care distributions, as permitted under section 401(a)(39) of the Internal Revenue Code. In particular, the notice provides guidance to providers of certified long-term care insurance  relating to the disclosure and reporting requirements under sections 401(a)(39) and 6050Z. In addition, the notice provides guidance under sections 72(t)(2)(N) and 401(a)(39) to plan administrators making and individuals receiving qualified long-term care distributions, including setting forth safe harbors for plan administrators in making qualified long-term care distributions. This notice also extends the deadline for a plan sponsor of a defined contribution plan that is not a governmental plan (within the meaning of section 414(d)), a section 403(b) plan maintained by a public school, or an applicable collectively bargained plan, to amend its eligible retirement plan to permit qualified long-term care distributions."  MORE >>

"[T]he median percentage remaining in 2022 after medical OOP spending was 71 percent for Social Security benefits and 88 percent for total income. ... In other words, OOP takes a big chuck of retirees’ resources, and the 10-percent increase in Medicare Part B premium [in 2026] suggests no relief on the horizon."  MORE >>

"[O]ne exception to the 10% additional tax on early withdrawals from an IRA under IRC Section 72(t) is for a series of substantially equal periodic payments (SEPPs). However, the series of payments must meet several stringent requirements to qualify for this exception."  MORE >>

"Under current law, retirement savers can exclude up to $111,000 (for 2026) per year in QCDs from gross income. ... The catch, however, is that QCDs must come directly from an IRA. Charitable distributions from employer-sponsored plans — such as 401(k), 403(b), and 457(b) plans — are not eligible for QCD treatment.... [T]he Charity Parity Act would expand on SECURE 2.0 by allowing direct QCDs from employer-sponsored retirement plans, ensuring equitable treatment of retirement savers."  MORE >>

"[T]he main risks you face in retirement come from events that will either lower your expected assets or increase your expected spending liabilities. These risks include: [1] Less favorable than assumed investment returns; [2] Higher that assumed future inflation or cost increases; [3] Lower than assumed Social Security payments; [4] Uninsured asset losses; [5] Unanticipated spending ... [This article describes] how you can stress test some of these risks[.]"  MORE >>

"All asset groups saw significant retention -- and even accumulation -- of assets by 21-22 years after retirement. Thirty-seven percent of the low-asset group preserved at least 80 percent of their asset value, with 33 percent retaining 100 percent or more of their retirement assets.... While 42 percent of middle-asset and 43 percent of high-asset retirees had less than 50 percent of their starting assets left by 21-22 years after retirement, 54 percent of the low-asset group did. "  MORE >>

"With this approach, money is withdrawn strategically to limit your tax exposure. The less you pay Uncle Sam, the more you have to spend or leave to your heirs. It's a strategy any retiree can use, but timing is everything. Those who spend more early in retirement must structure their plans differently from those who wait until later."  MORE >>

"After decades of urging discipline, restraint, and delayed gratification, we're now concerned that retirees are too disciplined -- that they're depriving themselves of the very retirement they spent a lifetime preparing for.... The industry's current 'solution'? If they won't buy [an annuity] on their own -- and if plan fiduciaries are (still) hesitant to put it on the menu -- well, let's default them into it -- by embedding it in a target-date fund or managed account."  MORE >>

"In practice, advisors typically begin with the client's target retirement date, and then adjust levers such as withdrawal rates, asset allocation, and spending flexibility to make the plan work. But when the retirement date is treated as fixed, an important part of the planning problem may be left unexamined: whether the timing of retirement itself is helping or hurting the plan from the outset."  MORE >>

"Like the documentation that was previously required for hardship distributions, the documentation needed to substantiate principal residence loans is highly variable, non- standardized, and often difficult to collect and submit in a timely fashion.... [U]pdated guidance on principal residence loans would help to reduce administrative burdens and costs for plans and participants ... This could also reduce leakage, since a participant who cannot take a plan loan expeditiously may instead take a withdrawal[.]"  MORE >>

"Most older Americans want Congress to 'save Social Security (and Medicare).' Many of those individuals believe (hope) that Congress will not reduce their benefits, but will, instead, save the system through increased revenue, from some source that will presumably not negatively affect them. And maybe this will be what happens, or maybe not. It is arguably more prudent and conservative to assume some level of benefit cuts will occur than to assume none."  MORE >>

34 pages; Mar. 19, 2026. "What's New ... [1] New box 10, 'Family leave benefits,' was added to Form 1099-G to facilitate the reporting of family leave benefits paid by state paid family and medical leave programs.... [2] Form 1099-R ... was revised to include new check boxes 7b for IRA, SEP, and SIMPLE plans, check box 7c for Trump Account reporting, and new box 7d for reporting earnings on excess contributions.... [3] Form 5498-TA, Trump Account Contribution Information, and Form 1099-LPS, Long-Term Care Premiums Paid Statement, are currently under development and projected to be released in mid-2026 for tax year 2026/filing season 2027."  MORE >>

"Retirees often rely on simple, hands-off spending strategies ... These approaches require little engagement or complex decision-making and may result in suboptimal spending.... Goal-setting may be the missing driver, where retirees may need new or renewed goals in retirement to motivate more-engaged spending decisions."  MORE >>

"Medicare Part B premiums, which cover doctors and hospital outpatient services, will rise to about $5,000 a year by 2035, up from about $2,440, according to a recent report by the Senate Joint Economic Committee.... Part of the expected increase in Medicare Part B premiums -- or about $450 a year of the projected $5,000 a year premium -- would be due to overpayments made by the government to Medicare Advantage plans, the report said."  MORE >>

"These projects reflect priorities that guide DOL's enforcement activities, which are conducted by investigators in the agency's regional and district offices. This article provides an overview of areas of focus for retirement plans, which include cybersecurity, retirement asset management, and protection of benefit distributions."  MORE >>

"83% of retirees who have money in an IRA account will not take their money out until they're forced to at the RMD age ... The number-one reason is they don't want to pay ... ordinary income on their deductible retirement accounts.... [W]hat would happen if we incentivize that money to come out of these accounts sooner, if we made it easier? ... [T]rillions of dollars would come out of these retirement accounts.... [R]etirees would ... either move it into a taxable account, leave the investments that they're already in and pay the flat tax, or some of that money would get loosened up."  MORE >>

"While it is true that annuities can't be a standalone default option, it is not legally correct to suggest that they can't be part of a default option ... In fact, the DOL has specifically ruled that ... a QDIA can include an insured income guarantee as a part of a qualified default investment alternative. The QDIA could, for example, be a managed account with an annuity or GLWB component, or a target-date fund with a GLWB."  MORE >>

"Roth accounts are the most tax advantageous in retirement, followed by a taxable brokerage account and traditional tax-deferred assets.... Retirees should be careful if they have taxable assets with a really low cost basis. For a lot of households, postretirement, pre-Social Security, and pre-RMD years can be very low-tax years, where you can accelerate withdrawals from a traditional IRA at an advantageous tax rate."  MORE >>

35 pages; Feb. 27, 2026. "What's New ... [1] New box 10, 'Family leave benefits,' was added to Form 1099-G to facilitate the reporting of family leave benefits paid by state paid family and medical leave programs.... [2] Form 1099-R ... was revised to include new check boxes 7b for IRA, SEP, and SIMPLE plans, check box 7c for Trump Account reporting, and new box 7d for reporting earnings on excess contributions.... [3] Form 5498-TA, Trump Account Contribution Information, and Form 1099-LPS, Long-Term Care Premiums Paid Statement, are currently under development and projected to be released in mid-2026 for tax year 2026/filing season 2027."  MORE >>

"Mr. Kitces proposes that Monte Carlo modeling using probability of success scores should still be developed, but the success scores should actually be withheld from clients and re-interpreted.... A much simpler and straightforward solution is to use an approach like the Actuarial Approach that compares household assets to spending liabilities."  MORE >>