FINRA Issues RMD Alert on Secure Act Changes
February 11, 2020 by Melanie Waddell
New required minimum distribution rules under the Setting Every Community Up for Retirement Enhancement Act of 2019, or the Secure Act, are prompting regulators to alert investors as well as broker-dealers and advisors to some “tricky” new requirements.
The Financial Industry Regulatory Authority, for instance, just released an “updated” Investor Alert that answers questions on brokerage firms’ reporting obligations with respect to RMDs as well as whether an investor needs to take an RMD if they own an annuity. The answer: It depends.
President Donald Trump signed the Secure Act into law on Dec. 20 as part of the year-end spending bill, the Further Consolidated Appropriations Act of 2020 (FCAA).
As to whether investors must take an RMD if they own a variable annuity, and it’s held in an IRA, the answer is yes, FINRA states.