Near the end of 2019, congress passed the Setting Every Community Up for Retirement Enhancement Act, or as most people call it, the SECURE Act. If you are a frequent reader of our blogs, you’ve probably noticed that we’ve had quite a few about the SECURE Act and all of the changes it made going forward.
The SECURE Act changed the deadline for when certain retirement plans (such as profit-sharing, pension, or annuity plans) had to be established. Before the SECURE Act passed, these plans needed to be setup by the end of the year. Now these plans can be adopted up until the due date of the tax return, including extensions. This allows businesses additional time in determining whether they want to start new retirement plans. It is important to note this change takes effect for tax years starting after 2019, meaning it does not apply to returns being filed this year.
While this change may not seem monumental among all of the changes the SECURE Act made, the added flexibility is a great way to help business owners plan for the future.
Please contact your Henry+Horne adviser with any questions regarding SECURE Act changes or taxes in general.
Richard Christensen, CPA