Published on January 29, 2020. Last Updated on October 14, 2025.
On December 20, 2019, Congress passed one of the most significant pieces of retirement legislation in decades: the Setting Every Community Up for Retirement Enhancement Act, better known as the SECURE Act. This law, effective January 1, 2020, brought sweeping changes to retirement planning, required minimum distributions (RMDs), and how inherited retirement accounts are handled after death.
While much has been written about the SECURE Act’s impact on saving for retirement, its effects reach far beyond investment accounts. The Act has profound implications for estate planning and elder law, changing how families pass on wealth and protect assets for future generations.
As an elder law attorney, I believe every individual and family—especially those with IRAs, 401(k)s, or other qualified retirement accounts—should understand how these laws may affect their estate plan. In this article, we’ll explore the impacts and detail some of the most important steps you should take to protect your assets and adapt your plan.
The SECURE Act at a Glance
The SECURE Act was designed to help Americans save more effectively for retirement. However, like many well-intended laws, it has created new complexities—especially for those who wish to leave their retirement accounts to loved ones in a tax-efficient manner.
Here are the key highlights of the Act that matter most for retirees and families:
1. Required Minimum Distributions (RMDs) Now Begin at Age 72
Before the SECURE Act, individuals had to start taking required minimum distributions (RMDs) from their qualified retirement accounts at age 70½. The new law increased the age to 72.
This means that individuals who had not reached 70½ before January 1, 2020, can now delay their first withdrawal until age 72. This extra 18 months allows for additional tax-deferred growth and gives retirees more flexibility in managing income and taxes during early retirement.
2. Contributions to Traditional IRAs Are Now Allowed After Age 70½
Under the old rules, individuals had to stop contributing to traditional IRAs after age 70½—even if they were still working. The SECURE Act eliminated this age restriction.
Now, as long as you have earned income, you can continue contributing to your IRA beyond age 70½. This change reflects longer life expectancies and allows older Americans to keep building their retirement savings if they choose to work later in life.
For many clients, this provision offers new planning opportunities. Continued contributions can help offset RMDs, support charitable giving strategies, or fund legacy goals.
The Most Impactful Change: The “10-Year Rule” for Inherited Retirement Accounts
While the first two provisions are relatively positive, the most dramatic—and challenging—change under the SECURE Act affects inherited IRAs and other retirement accounts.
Before 2020, non-spouse beneficiaries could “stretch” distributions from an inherited IRA over their own life expectancy, minimizing annual tax burdens and allowing assets to continue growing tax-deferred.
Under the SECURE Act, that stretch strategy has been largely eliminated. Now, most non-spouse beneficiaries must withdraw the entire balance of an inherited retirement account within 10 years of the original owner’s death. This can potentially trigger significant income taxes and disrupt long-term wealth transfer strategies.
Exceptions to the 10-Year Rule
There are several important exceptions where the old “stretch” rules may still apply:
- Surviving Spouses – Spouses can still roll over the inherited account into their own IRA and take distributions over their lifetime.
- Disabled or Chronically Ill Beneficiaries – Individuals meeting IRS definitions for disability or chronic illness may still use a life expectancy payout.
- Beneficiaries Less Than 10 Years Younger – If the beneficiary is not more than 10 years younger than the account owner, the lifetime payout option may apply.
- Minor Children of the Account Owner – Minor children can stretch payments until they reach the age of majority. Once they do, the 10-year payout period begins.
Everyone else—including most adult children and grandchildren—must follow the 10-year rule.
Why the SECURE Act Matters for Estate Planning
This shift in distribution rules has significant implications for estate planning. Many families had previously designed their trusts and estate plans based on the “stretch IRA” concept. Under the new law, those same plans could now create unintended tax burdens.
1. Accelerated Taxation
Under the 10-year rule, beneficiaries may be forced to take large distributions during their peak earning years, potentially pushing them into higher tax brackets. What once was a steady stream of supplemental income may now become a sudden, taxable windfall.
2. Reduced Asset Protection
Inherited IRAs no longer enjoy the same long-term protection benefits they once did. If assets must be withdrawn more quickly, they may lose the shielding effect that came from being inside a tax-deferred account.
3. Outdated Trust Language
Many estate plans drafted before 2020 include conduit trusts designed to distribute only the required minimum distributions each year. Under the SECURE Act, there are no annual RMDs during the 10-year period—just one lump-sum requirement by the end of that window. This could inadvertently prevent a beneficiary from receiving any distributions until year 10, when they would suddenly receive the entire account balance—and the full tax hit at once.
Because of these consequences, it’s critical to review and possibly update your estate plan to ensure it still aligns with your goals under the new rules.
Planning Strategies Under the SECURE Act
Although the SECURE Act eliminated the stretch IRA for many, there are still effective strategies to manage taxes and preserve wealth. Here are some options to consider discussing with your elder law attorney or financial advisor:
1. Roth IRA Conversions
Converting a traditional IRA to a Roth IRA can be an effective way to reduce future tax burdens. While you’ll pay taxes on the conversion amount now, qualified Roth withdrawals for your beneficiaries are tax-free. This can help minimize the impact of the 10-year rule.
2. Charitable Remainder Trusts (CRTs)
For those with philanthropic goals, a charitable remainder trust can provide lifetime income to beneficiaries while ultimately benefiting a charitable organization. CRTs can help mimic the old “stretch” by spreading income over time and potentially reducing taxes.
3. Life Insurance as a Tax-Efficient Tool
Using distributions from retirement accounts to fund a life insurance policy can be a powerful estate planning strategy. The death benefit can replace the after-tax value of retirement assets and pass to heirs tax-free.
4. Periodic Withdrawals and Gifting
If you anticipate leaving a large retirement balance, consider taking strategic withdrawals during your lifetime. You can gift or transfer assets in lower-tax years, potentially reducing the taxable burden on your heirs later.
Why You Should Revisit Your Estate Plan
If your estate plan was drafted before January 1, 2020, it likely does not account for the SECURE Act’s new distribution rules. Even well-crafted plans may now create tax complications or fail to protect beneficiaries as intended.
Now is the time to:
- Review your beneficiary designations on all retirement accounts.
- Update your trust language to ensure flexibility under the new 10-year rule.
- Coordinate with your elder law attorney and financial advisor to explore Roth conversions or alternative structures.
- Educate your family members so they understand how the SECURE Act affects their inheritance and tax responsibilities.
This type of proactive planning ensures that your wealth is transferred in the most efficient, protected way possible.
Get the Support You Need from Bellomo & Associates
The SECURE Act has reshaped the landscape of retirement and inheritance planning, but with thoughtful preparation, you can still achieve your financial and legacy goals. At Bellomo & Associates, our experienced elder law and estate planning attorneys are here to help you navigate these changes with confidence.
We’ll review and update your estate plan in light of the SECURE Act, protect your beneficiaries from unnecessary taxes and financial stress, and develop tax-efficient strategies for inherited retirement accounts. By coordinating your retirement, estate, and long-term care planning into one cohesive strategy, we ensure every aspect of your future is aligned and secure.
Our mission is simple: to help you protect what matters most and give you peace of mind knowing your plan still works under the new law. If you have questions about how the SECURE Act affects your estate plan or inherited retirement accounts, contact our office today to schedule a consultation and take the next step toward a stronger financial future for you and your family.
