I noticed this: >>>>>>>>>>>>>>>>>>>>>>>>>>>
...starting in 2024, RMDs will no longer be required from Roth accounts affiliated with employer retirement plans, e.g. Roth 401ks.
I never heard of a Roth 401K and how could it be a Roth if they required an RMD? (Maybe it was required but one didn't pay tax on it?).
I'm sure I'm missing something.
Mel
Prior to Secure 2.0 Employer based Roth 401K accounts required RMDs just like an employer 401K. This led to a plan to rollover the Roth 401K to a Roth IRA at retirement to avoid having to take RMDs. But, one had to be careful because the tax-free distributions of earnings required that the Roth be in existence for at least 5 years.
Secure 2 fixes these "issues" by making the Roth 401K look like a Roth IRA for the purpose of RMDs starting in 2024.
Roth 401k's have been permitted for quite a while. However, not all plans allow them. I can't say for sure what the proporation is, but in my personal experience it's less than 50%.
I haven't worried about it but I've always assumed you could dodge the RMD's by rolling the Roth 401k into a Roth IRA. Most people with a Roth 401k are no longer contributing by the time RMDs start, and even if they aren't, most plans permit in-service withdrawals if you're in that old an age bracket.
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