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How do the 2026 RMD changes interact with SECURE Act and SECURE Act 2.0 provisions?
Executive summary
SECURE Act 1.0 [1] raised the required beginning date and eliminated the “stretch IRA” for most non‑spouse beneficiaries (creating a 10‑year distribution rule), and SECURE Act 2.0 further raised RMD ages (to 73 in 2023 and to 75 in 2033) and reduced penalties for missed RMDs while exempting Roth 401(k)/403(b) accounts from lifetime RMDs; many of 2.0’s implementation dates and catch‑up changes (notably the mandatory Roth catch‑ups for higher earners starting in 2026) affect interaction and administration of RMDs and plan design [2] [3] [4] [5]. Several final and proposed Treasury/IRS RMD regulations and an IRS applicability delay to 2026 also shape how those statutory changes will be applied by plans and beneficiaries [6] [7].
1. How SECURE 1.0 set the RMD baseline—and what it still controls
The original SECURE Act [1] changed estate/beneficiary treatment by largely eliminating the “stretch IRA” for most non‑spouse beneficiaries and imposing a 10‑year distribution rule after the account owner’s death; that 10‑year rule remains the statutory baseline for inherited IRAs and affects timing and tax planning for beneficiaries under both SECURE 1.0 and 2.0 [2]. SECURE 1.0 also moved the RMD start from age 70½ to 72, which served as the foundation for the later phased increases under SECURE 2.0 [2].
2. SECURE 2.0’s headline RMD changes and direct interactions with 1.0
SECURE 2.0 increased the RMD starting age to 73 (for many) in 2023 and provides for a further increase to 75 for those born in or after 1960 (effective 2033); this changes when the statutory 10‑year and other SECURE 1.0 timing rules begin to interact with a beneficiary’s or owner’s required beginning date [3] [6]. SECURE 2.0 also reduced the excise penalty for missed RMDs (from as high as 50% previously to 25%, with potential reduction to 10% if corrected quickly), altering the compliance risk calculus that arose under SECURE 1.0 [8] [4].
3. Roth rules — fewer lifetime RMDs and more Roth in/out complexity
SECURE 2.0 excludes Designated Roth accounts in 401(k)/403(b) plans from lifetime RMDs, meaning Roth 401(k)/403(b) balances no longer must be distributed during the original owner’s life; this narrows one area where SECURE 1.0-era beneficiary and RMD rules created friction, since Roth IRAs had been RMD‑free but employer Roth accounts had not [3] [5]. At the same time, SECURE 2.0’s mandatory Roth catch‑up contributions for certain higher earners (workers with FICA wages over a threshold—commonly referenced as $145,000 indexed—beginning in 2026) will increase Roth balances inside plans, which could change future RMD profiles for beneficiaries once plan Roths are distributed after death [9] [5] [10].
4. The 2026 catch‑up shift: operational and tax implications that touch RMDs
Beginning in 2026, catch‑up contributions for participants above the applicable income threshold must generally go into Roth (after‑tax) accounts; several firms and plan sponsors warn this will require plan amendments, operational changes, and participant communications—issues that also affect how plans calculate and report RMDs and beneficiary distributions under SECURE 1.0 rules [11] [12] [13]. The practical effect: more Roth inside employer plans may reduce lifetime RMD tax drag for owners (where Roth employer accounts are RMD‑exempt) but beneficiaries still face distribution timing rules established by SECURE 1.0 and IRS guidance [5] [3].
5. Regulatory guidance, delays, and why the 2026 date matters
Treasury/IRS final and proposed RMD regulations have attempted to reconcile SECURE 1.0 and SECURE 2.0 rules, but industry commenters prompted the IRS to delay applicability of some RMD regulations so that final rules won’t apply before the 2026 distribution year—meaning plans and recordkeepers get extra time but also face a compressed window to implement 2026 changes [6] [7]. Analysts and plan advisors emphasize sponsors should still prepare now because plan amendments for many SECURE 2.0 provisions are due by December 31, 2026 [11] [6].
6. Conflicting priorities and practical takeaways for savers and sponsors
Plan sponsors must balance quicker operational changes (auto‑enrollment, Roth catch‑ups) against final regulatory detail that may arrive late; industry writers note the IRS delay helps administration but not the need for readiness [7] [11]. Participants should reassess Roth vs. traditional balances, the shifting RMD start ages, and the interaction of 10‑year inherited rules with growing plan Roth balances—while recognizing that beneficiaries’ obligations remain governed by SECURE 1.0’s distribution framework unless specific SECURE 2.0 exceptions apply [2] [5].
Limitations and unanswered items: available sources outline statutory changes, implementation dates, and IRS delays, but do not provide exhaustive examples of every beneficiary‑type interaction or final Treasury regulatory text for every scenario—plan‑specific guidance and IRS final regs (some delayed to 2026) will be needed for definitive compliance steps [6] [7].