Knowledge Center

Secure Act 2.0: Benefits for Surviving Spouses


Sixth in a series of articles addressing key components of the SECURE 2.0 Act, which became law on Dec. 29, 2022

By Christopher Wolff

The SECURE 2.0 Act includes major retirement plan changes designed to strengthen the financial readiness of Americans to retire. The changes resulting from the SECURE 2.0 Act will be phased in, with some beginning in 2023 and most becoming effective in 2024 and beyond.

This article focuses on the key changes related to surviving spouses and their inherited retirement accounts.

Prior Options for Surviving Spouses

Before the passage of SECURE Act 2.0, a surviving spouse had two basic options when they inherited their deceased spouse’s IRA. First, they could roll the IRA into their own, thus treating the IRA as their own. Or, second, they could remain as a beneficiary of their spouse’s IRA.

The SECURE Act 2.0 introduced an additional option: Surviving spouses can now elect to be treated as the deceased spouse.

What the New Option Means

If the surviving spouse chooses to be treated as the deceased spouse, the following are affected:

  1. Delayed Required Minimum Distributions (RMDs). The surviving spouse can delay taking RMDs until the age when the deceased spouse would have been required to start taking RMDs.
  2. Uniform Lifetime Table. The surviving spouse will use the Uniform Lifetime Table rather than the Single Lifetime Table to calculate their RMDs. The advantage here is that the Uniform Lifetime Table generally provides lower RMD amounts, which means the surviving spouse can potentially take the distributions over a longer period.
  3. Subsequent Beneficiaries. If the surviving spouse dies before the age at which they are required to take RMDs, their beneficiaries will be treated as the original beneficiaries. This provision may allow the retirement account’s tax-deferred growth to continue longer, thus benefiting subsequent generations.

The change to provisions for surviving spouses under SECURE Act 2.0 would primarily benefit situations where the deceased spouse is younger than the surviving spouse. It provides the surviving spouse, especially one who has many years before RMDs kick in, with an opportunity to continue growing the retirement account on a tax-deferred basis. This benefit, combined with the use of the Uniform Lifetime Table for calculating RMDs, potentially extends the longevity of the surviving spouse’s retirement benefits and may reduce tax liability.

SECURE ACT 2.0 Summary

The 2019 version of the SECURE Act (Setting Every Community Up for Retirement Enhancement Act) introduced changes to retirement planning designed to put U.S. workers in a better position when they retired. The SECURE 2.0 Act, enacted in 2022, provided several updates and additions. Among them:

You can find more details about each of these by visiting the Knowledge Center on our website or by contacting your Country Club Trust Company representative.

Some information provided herein may be obtained from outside sources believed to be reliable, but no representation is made as to its accuracy or completeness. This information is intended for discussion purposes only and should not be considered a recommendation. The information contained herein does not constitute legal, tax or investment advice by Country Club Trust Company. For legal, tax or investment advice, the services of a competent professional person or professional organization should be sought. Trust services and investments are not FDIC insured, are not guaranteed by the Trust Company or any Trust Company affiliate, and may lose value. Past performance is no guarantee of future results.