Broker Check

Quarterly Newsletter- 12/31/2019

December 31, 2019

Dear Clients: 

Under normal circumstances, I would give you a glamorous review of the past decade and look into my crystal ball to predict exactly what the next decade is going to bring. Unfortunately, my crystal ball is very cloudy now as a result of my daughter Cassidy dropping baking flour all over it. In all seriousness, Congress recently passed extremely important legislation called the Secure Act. This Act may affect you and your plans for the future. Below I have listed some of the changes you should be aware. If you need further clarification of these changes, let me know and we can discuss them in more detail.

  • There is no longer an age limit to contributing to a traditional IRA.

  • Penalty free withdrawals from retirement accounts for qualified birth or adoption expenses. The Act amends Section 72(t) of the Code to add an exception that allows penalty-free “qualified birth or adoption distributions” of not more than $5,000 during the one-year period beginning on the date on which a child is born or which the adoption is finalized


  • The age for Required Minimum Distributions has increased from 70.5 to 72. This change will apply to individuals who attain age 70½ after December 31, 2019


  • The legislation expands 529 education savings accounts to cover costs associated with registered apprenticeships; homeschooling; up to $10,000 of qualified student loan repayments (including those for siblings); and private elementary, secondary, or religious schools.


  • Under prior law, beneficiaries of an IRA (other than spouses, in many cases) or defined contribution plan account could “stretch” the required minimum distributions over their own lifetime. The Act amends Section 401(a) of the Code so that following the death of a participant in a defined contribution plan or an IRA owner, distributions generally must be made by the end of the 10th calendar year following the year of the death. The rule would not apply to surviving spouses of the participant or IRA owner, disabled or chronically ill beneficiaries, beneficiaries who are not more than 10 years younger than the participant or IRA owner or to children of the participant or IRA owner who have not reached the age of majority.


  • The Act amends the term “compensation” in Section 219 of the Code to expressly include amounts paid to an individual to aid in the pursuit of graduate or postdoctoral study. With the proposed change, graduate and postdoctoral students could use these grants to make IRA contributions.

There are more parts of this Act which may or may not affect you. For a full explanation of these topics feel free to research the “Secure Act”. As always, the Rosenblatt Team thanks you for all the years of dedicated trust and we look forward to another decade of successful planning.


Craig Rosenblatt, CPA,

Financial Advisor

California Insurance License #0E18620