New Tax Rules for 2011: Retirement Plan Changes

The new tax rules enacted over the past few years have affected many areas of the tax code.  For your information, we have summarized below the changes related to retirement plans.  Be sure to talk to your accountant about the changes as part of your annual tax planning conversations.

1. Small employers may establish “simple cafeteria plans.” –  In 2011, companies employing under 100 people on business days during either of the past two years, may offer a “simple cafeteria plan,” and will be exempt from nondiscrimination requirements set by these plans.

2.  Election to treat January 2011 charitable distributions as made in 2010 – Individuals over 70 1/2 can make tax-free charitable contributions from an IRA of up to $100,000, for transfers made in fiscal years before 2012.  Also, if the contribution is made in 2011, it can be treated like it was paid out on December 31, 2010.  This allows that contribution to apply to the 2010 exclusion and may apply to the 2010 minimum distribution for an IRA.

If you have any questions on how these changes affect you, please contact our office.

© 2011 Thomson Reuters/RIA. All rights reserved.

Call Now Button