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University of California, Riverside –

In late December 2019, the Setting Every Community Up for Retirement Enhancement (SECURE) Act was signed into law and contains sweeping changes for retirement programs including IRAs and employer sponsored plans.

The majority of the changes in the SECURE Act either do not impact the University of California Retirement System (which includes UCRP,  403(b), 457(b) and the DC Plan) or are not required to be adopted. However, the one mandatory change that impacts our retirement plans is a modification to the Required Beginning Date (RBD), the date by which a participant must begin to take Minimum Required Distributions (MRDs).

The new rules raised the MRD age as follows:

For those born July 1, 1949 or later, effective January 1, 2020, the RBD is the April 1st following the later of:

  1. The calendar year in which the participant turns age 72
  2. The calendar year in which the participant separates from UC employment.
What remains unchanged

For those who were 70 ½ prior to January 1, 2020 (born June 30, 1949 or earlier), the RBD remains the April 1st following the later of:

  1. The calendar year in which the participant turns age 70 ½
  2. The calendar year in which the participant separates from UC employment.

To ensure full compliance with the IRS regulations and avoid penalties for participants who fail to take MRD’s timely, UC and Fidelity are updating processes, procedures and communications, as well as training service teams to accommodate the new rules. Fidelity will also be sending out a notification of the changes to Retirement Savings Plans participants.

Important Note: As before, all participants who begin receiving MRD’s from their retirement plans will continue to do so annually, even if they return to work at UC. Additionally, if a member elects a lump sum distribution from UCRP (such as a Lump Sum Cashout, refund of UCRP accumulations or CAP distribution), a full taxable MRD distribution will be issued separately as required prior to any amount that has been requested to be rolled over to another qualified plan, in accordance with the rules above.

If members have questions about the changes and the impact on their Retirement Savings Plans, they can contact Fidelity at 1 (800) 558-9182. For questions about UCRP, please contact the RASC at 1 (800) 888-8267.