Quick Summary

Here’s a summary of recent legislative changes affecting retirement accounts and estate planning.

Over the past few years, Congress has changed many of the rules about retirement accounts — especially how they are inherited and when required withdrawals must begin. These changes came through laws commonly called the SECURE Act and SECURE 2.0.

Retirement accounts include things like IRAs, 401(k)s, and similar savings plans. For many families, these accounts are now one of the largest assets they own, which makes planning for them more important than ever.

Why This Matters

The biggest change in recent years is how inherited retirement accounts work.

For many years, a child or other beneficiary could stretch withdrawals from an inherited retirement account over their lifetime. That allowed the money to keep growing and delayed income taxes, sometimes for decades.

Today, most non-spouse beneficiaries must withdraw inherited retirement accounts within 10 years. In some situations, they may also need to take annual required withdrawals during that period, depending on the circumstances.

That change alone has reshaped retirement and estate planning.

Another important shift involves required minimum distributions (RMDs) — the age when retirement account owners must begin taking withdrawals.

Under current law:

  • Age 73 applies to individuals born between 1951 and 1959

  • Age 75 will apply to individuals born in 1960 or later, beginning in 2033

This means retirement accounts can often grow longer before withdrawals are required, which can create both opportunities and planning challenges.

Spouses also have more flexibility than before. In some cases, a surviving spouse can delay withdrawals and use more favorable calculation rules. This can help preserve retirement savings for a longer period of time.

There have also been changes to estate tax rules. The federal estate tax exemption remains historically high ($15 million in 2026), which means fewer families owe estate tax than in the past. For many couples — especially those whose largest asset is a retirement account — planning decisions today often focus more on income tax timing and beneficiary choices than estate tax itself.

Still, the rules are complicated. Planning sometimes involves balancing income taxes, beneficiary protections, and long-term family goals. What looks simple on paper can become complicated in real life.

And as we often see, the rules matter — but so does how they’re applied in the real world. Retirement accounts and beneficiary designations should always be reviewed as part of an overall estate plan.

Simple Lesson

Retirement accounts don’t pass by accident — they pass by beneficiary design.

Action Step

Make a list of every retirement account you own and confirm who is named as beneficiary on each one.

If you’d like help reviewing your plan, call (517) 548-7400 or connect with us here: https://www.michiganestateplans.com/contact-us