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From December 2019 through March 2021, we saw a flurry of federal legislation with significant implications for taxpayers. Now, more than halfway through 2022, we look briefly at past legislation’s impact and what may come from Congress before year-end.

The SECURE Act1, of which most provisions became effective January 1, 2020, made far-reaching changes to retirement account owners and beneficiaries. Some of the Act’s most notable highlights were an increase in the age at which retirement account owners must begin Required Minimum Distributions (RMDs), the timeline for some retirement account beneficiaries to withdraw dollars from an inherited retirement account, and allowing individuals older than 70.5 to contribute to IRA accounts.

The CARES Act2 (March 2020), certain portions of the Consolidated Appropriations Act3 (December 2020), and the American Rescue Plan4 (March 2021) included an assortment of economic stimulus features (including direct stimulus “rebates” to taxpayers) along with temporary tax measures such as suspending RMDs for the 2020 tax year and increasing the child tax credit.
In mid-2021, negotiations began around new legislative provisions that would ultimately become known as the Build Back Better Bill5. Among the bill’s terms were tax increases for high-income taxpayers and a cap on the dollars that could be accumulated in Roth IRA accounts. Negotiations around the entire bill stalled in January 2022, and pieces of the bill have continued to be debated by members of Congress through the current day. Thus far, the debate has not centered around provisions with specific income tax or retirement planning impacts.

As we draw nearer to mid-term elections, there is waning confidence that new tax legislation will be passed before November. If we see tax legislation before year-end, it may have made its way through the House and Senate in different forms. This new legislation has garnered the moniker of “SECURE Act 2.0” (or “Son of Secure” if you prefer a more ominous name), as it builds on provisions from its predecessor mentioned above. The House version of bill6 passed in March 2022, and Senate committees have a proposal that could be reconciled with the House version to form a final bill. The proposed changes in the recommendations are beneficial to taxpayers, with two that will have the broadest impact on retirement savers:

  1. Increase to RMD Age (again): just as the SECURE Act increased the age at which retirement plan distributions begin (from age 70.5 to age 72), so too would this legislation. Current provisions are for an incremental increase from age 72 to 75 by 2033.
  2. Boosted Retirement Plan Catch-Up Contributions: Currently, workers age 50 and older can contribute an additional $6,500 to retirement plans each year. The legislation would allow workers between the ages of 60-65  to contribute up to $10,000 additional per year. However, the contributions must be made in Roth form (meaning the contributions are made on an after-tax basis).

At Bridgeworth, we often say part of the value we offer clients lies not in a static financial plan but rather in the ongoing process of financial planning. Whether guiding you through changes in tax law or your personal life transitions, we are grateful for your trust in us as your financial partner.

Bridgeworth Wealth Management is a Registered Investment Adviser.


Bridgeworth is now a part of Savant Wealth Management as of 11/30/2023. Savant Wealth Management (“Savant”) is an SEC registered investment adviser headquartered in Rockford, Illinois.