May 2019 Note from the Principals

The tax filing deadline may be behind us, but the world of self-directed IRA investing is never short of intrigue. At New Direction Trust Company, we pride ourselves on staying abreast of the evolving regulations that may affect your account with us.

The Setting Every Community Up for Retirement Enhancement Act of 2019 (The SECURE Act) has passed through the House Committee on Ways & Means and may now be approved by the higher branches of government. If implemented, the SECURE Act would carry a series of important developments for retirement investors. Pertinent sections are paraphrased below.

  • Section 106 – The repeal of the maximum contribution age for Traditional IRA holders. These account holders may have the ability to make contributions beyond age 70 ½ to account for their higher life expectancies.

  • Section 113 – Required minimum distributions (RMDs) would no longer be required at age 70 ½, again to compensate for higher life expectancies. RMDs would, however, be required upon reaching age 72.

  • Section 401 – A non-spouse Inherited IRA holder would be required to fully distribute the inherited account by the end of the tenth calendar year following the decedent’s death.

  • Section 112 – Premature IRA distributions can be taken penalty-free if withdrawn funds or assets help cover “qualified birth or adoption” expenses.

  • Section 105 – Graduate and post-doctoral students who receive non-tuition fellowship payments or stipends may disregard such payments when determining eligibility for IRA contributions. One’s modified adjusted gross income (MAGI) may impact the tax deductibility of contributions or the allowable contribution amount. This section would appear to provide a leg up for younger investors by removing these school-related payments from MAGI.

Click here to review the SECURE Act in full. Please bear in mind that these proposals have not been enacted as law. Give us a call at 877-742-1270 or send us an e-mail at if you have any questions or concerns.


Catherine Wynne & Bill Humphrey