Retirement Income Planning Issues for 2021
An important contribution that professionals provide to their clients is to encourage them to save enough for retirement. As the government continues to enact changes to make it easier for employers to offer retirement plans to their employees, professionals can relay these benefits to clients to encourage retirement savings by employees. Changes in recent rounds of legislation achieve this objective by removing the age restriction on contributing to one’s IRA, by allowing certain home health care workers to contribute to a defined-contribution plan or IRA, and to allow individuals to take penalty-free distributions from qualified retirement plans and IRAs for special events such as a child’s birth or adoption. Now that these new rules for employees and employers are in place, clients and potential clients will need to be aware of them for their year-end planning and for looking ahead to 2021 and beyond.