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Net Unrealized Appreciation (NUA) and See-Through Trusts: Today's Slott Report Mailbag

Question: Good afternoon. I am looking for some Net Unrealized Appreciation (NUA) help, please. If someone does a rollover of company stock to an IRA, can she undo that rollover and then do an NUA transaction? Thanks, Alan

Top 10 IRA “Popular Confusions”

By Andy Ives, CFP®, AIF®
IRA Analyst
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The Ed Slott team answers thousands of IRA and work plan questions annually - emails, phone calls, in-person conversations, webinars, Q&A programs and texts. We accommodate all members of the Ed Slott Elite Advisor Group, work with non-member advisors at our 2-Day training programs, and answer questions from the general public via our weekly mailbag. Over time, certain inquiries repeat themselves. I call these “popular confusions.” Here are 10 IRA and work plan topics that you may have stumbled across yourself:

Beware of Investing IRAs in NFTs

If you are thinking of buying an NFT (non-fungible token) with your IRA funds, you may want to reconsider. In Notice 2023-27, the IRS said that NFTs associated with “collectibles” are prohibited IRA investments. This could expose you to significant taxes and penalties.

October 16: Deadline for Correcting 2022 IRA Contributions

Maybe you made a Roth IRA contribution for 2022 and then discovered your income was too high. Maybe you contributed to a traditional IRA but later discovered that the contribution was not deductible. You may have made an IRA contribution and just changed your mind. You’d rather contribute to a Roth IRA or maybe not contribute at all. There is good news if you act quickly. You can fix these issues by correcting your 2022 IRA contribution by the upcoming October 16, 2023 deadline.

“Mid-Air” Roth Conversions

If ever I was traveling from Los Angeles to Atlanta, I would choose a direct flight with no layovers. I want the most efficient route to my destination. Point A to Point B. Take off, land. Assuming no difference in ticket price and all things being equal, if another LAX to ATL itinerary included a stop in, say, Chicago, would there be any reason to take it? Why pass through another airport in another city when I can fly direct?

Rules for Inherited IRAs that May Surprise Nonspouse Beneficiaries

Many IRA assets will ultimately go to nonspouse beneficiaries. When these beneficiaries inherit the funds, special rules kick in. Inherited IRAs are not like your own personal IRA account. Here are seven rules for inherited IRAs that may surprise you if you are a nonspouse beneficiary:

Roth Conversions and Inherited Roth IRA RMDs: Today’s Slott Report Mailbag

Question: Hello, If you do a Roth conversion from an IRA, does that qualify as your required minimum distribution (RMD) for the year? Or is it separate and apart from the RMD? Thank you,

IRA Beneficiary Payout Rules – the Madness Continues

The lunacy of IRA beneficiary payout rules continues to boggle the mind. As I guide advisors through the options available to their clients, various nuances present one unique scenario after another. Did the original IRA owner pass away before or after the establishment of the SECURE Act? How old was the person when they died? Who was the beneficiary? Is this a successor beneficiary situation? Ultimately, by following the individual fact patterns, definitive answers materialize.

IRS Delays Effective Date of Mandatory Roth Catch-Up Rule Until 2026

Last Friday afternoon (August 25, 2023), the IRS gave employer plans two more years to comply with the controversial SECURE 2.0 rule requiring “catch-up contributions” for high-paid employees to be made on a Roth basis. The effective date of the rule was postponed from January 1, 2024 to January 1, 2026. The delay is set forth in IRS Notice 2023-62.

The Age 50 Exception and the Still-Working Exception: Today's Slott Report Mailbag

QUESTION: Hello! I recently came across one of your articles and decided to reach out to you in hopes of getting some clarification re: the Secure Act 2.0 and distributions as a qualified public safety employee. In a nutshell, I am a 17-year career firefighter for a county government. With the new Secure Act 2.0, it seems as though I can take distributions after 25 years of service, OR age 50, whichever comes first, without penalty. If this is true, would I be eligible to begin taking distributions at age 47, without penalty?

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