IRS Delays Final RMD Regulation, Gives Relief for New 10-year Payment Rule

Summary

Updated final regulations for required minimum distributions (RMDs) under Internal Revenue Code (IRC) Section 401(a)(9) will not apply before 2023, IRS has announced in Notice 2022-53. The regulations will implement two significant changes to the RMD requirements made by the Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019 (Div. O of Pub. L. No. 116-94), along with various other statutory changes. The act increased the RMD beginning age from 70-1/2 to 72 and set new limits on "stretch" distributions to defined contribution (DC) plan beneficiaries. The notice also provides relief for DC plans that failed to make RMDs in 2021 or 2022 to beneficiaries under a new 10-year payment rule and gives excise tax relief to affected individuals.