Current user of Compliance Systems’ Tax Favored Plan Account documents, we would like to provide you with information regarding changes made to Individual Retirement Accounts (IRAs) by the Setting Every Community Up For Retirement Act of 2019 (SECURE Act of 2019) which was signed by President Trump on December 20, 2019. Some of the provisions impacting IRAs which are effective January 1, 2020, include: (1) eliminating the restriction of funding a Traditional IRA past the age of 70½; (2) changing the age for individuals to start taking required minimum distributions (RMDs) from age 70½ to age 72;(3) adding an exception to the early withdrawal penalty for up to $5000 of qualified birth and adoption expenses; and (4) accelerated withdrawal requirements for many IRA nonspouse beneficiaries.

Because of the scope of these changes to IRAs, we anticipate that guidance and updated model language from the Internal Revenue Service (IRS) is forthcoming. In the interim, so that your customers or members are informed of the new law changes, we strongly recommend that you provide an IRA Disclosure Supplement (enclosed) in addition to the required documents when establishing any new Traditional, SEP, SIMPLE, and Roth IRAs on or after January 1, 2020.

Compliance Systems will continue to monitor for any further guidance on these changes and will be making changes to our solution as necessary with more information to follow.

If you have questions, please contact Compliance Systems’ Client Support department at support@compliancesystems.com

The content contained in this correspondence and the sample IRA Disclosure Statement is for informational purposes only and shall not be construed as legal advice: Compliance Systems and its products and services (1) are not in any way a substitute for the advice of an attorney and (2) do not constitute legal advice or consul of any sort, in any jurisdiction, on any matter. 

  • Purpose of the IRA Disclosure Statement is for financial institutions to distribute it to existing plan owners.