Page 29 - May 2023 Issue.indd

P. 29

New Law May Oﬀ er • New options for qualified charitable distributions

– If you’re 70½ or older, you can make a one-time
Financial Opportunities qualified charitable distribution (QCD) of up to

$50,000 to entities that previously couldn’t receive
Submitted by Ann Jacobs, Financial
these QCDs, including charitable remainder
Advisor, Edward Jones - Denton
annuity trusts, charitable remainder unitrusts and
410-479-0271 charitable gift annuities that meet certain criteria.

Because QCDs are typically excluded from your
Your own decisions and actions typically determine your fi nancial taxable income and could satisfy some or all of your
strategies. But outside events can affect your choices, too. And that required RMDs, which are otherwise taxable, these

may be the case with the recent passage of the SECURE 2.0 Act. expanded opportunities may prove benefi cial from
a tax standpoint. Consult with your tax advisor to
This piece of legislation covers many areas. But here are some
determine if and how QCDs make sense for your
changes that may be of interest to you, depending on your situation:
situation.
If you’re a retiree …
If you’re still working …

• Higher age for RMDs – The age at which you must take with- • Roth contributions to retirement plans – Starting
drawals — known as required minimum distributions, or
this year, if you participate in a 401(k) or similar
RMDs — from your traditional IRA and 401(k) has increased
plan, you can take your employer’s matching and
from 72 to 73, effective this year. (If you turned 72 in 2022,

other contributions on a Roth basis. While these

but still haven’t taken your first RMD, you will need to do so
contributions will count as taxable income, they can
this year.) And in 2033, the RMD age will increase again, to
ultimately be withdrawn, along with any earnings
75. You don’t have to wait until these ages before taking with-
they generate, tax free, provided you meet certain
drawals, but the new age limits may affect your withdrawal

conditions.
decisions.
If you’re a business owner …
• Lower penalties for missed RMDs – If you don’t take at least
the RMD for a given year, you could face tax penalties. Previ- • Increased tax credit for starting a retirement plan – If
ously, this penalty was 50% of the amount you were supposed you have 50 or fewer employees, you can now claim
to have taken but now it’s reduced to 25%. a startup credit covering 100% — up from 50% — of
the administrative costs of opening a 401(k) plan,
up to $5,000 for each of the first three years of the

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plan.
• Employer contribution credit – You may now be able
Compare our CD Rates to get a tax credit based on employee matching or
Bank-issued, FDIC-insured profit-sharing contributions. This credit is capped at

. $1000 fi ve years.
NPOUI % APY* Minimum deposit $1,000 per employee and phases out gradually over
. $1000 fewer employees who earn at least $5,000 annually,
-year % APY* Minimum deposit • Military spouse tax incentive – If you have 100 or
. $1000 years if you make military spouses eligible for a
-year % APY* Minimum deposit you can earn a tax credit of up to $500 for three
retirement plan, such as a 401(k) or SEP IRA. You
Call or visit your local financial advisor today. can receive the credit for the year in which the mili-
Ann M Jacobs, AAMS® tary spouse is hired, plus the next two taxable years.
Financial Advisor
These aren’t the only provisions in the SECURE 2.0 Act

105 Franklin St
Denton, MD 21629-1207 that may be relevant to you, and some parts of the new
410-479-0271
law go into effect in the future. You may want to contact

your financial and tax advisors to see just how you might
* Annual Percentage Yield (APY) effective 4/20/2023. CDs offered by Edward Jones are bank

issued and FDIC-insured up to $250,000 (principal and interest accrued but not yet paid) per ultimately be affected by this legislation, and how you could
depositor, per insured depository institution, for each account ownership category. Please take advantage of it.

visit www.fdic.gov or contact your financial advisor for additional information. Subject to
availability and price change. CD values are subject to interest rate risk such that when Edward Jones, its employees and financial advisors cannot provide tax

interest rates rise, the prices of CDs can decrease. If CDs are sold prior to maturity, the

investor can lose principal value. FDIC insurance does not cover losses in market value. Early or legal advice. You should consult your attorney or qualified tax advisor
withdrawal may not be permitted. Yields quoted are net of all commissions. CDs require regarding your situation.
the distribution of interest and do not allow interest to compound. CDs off ered through
Edward Jones are issued by banks and thrifts nationwide. All CDs sold by Edward Jones are This article was written by Edward Jones for use by your

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