What You Need to Know About the SECURE Act and Your Estate Plan

The Setting Every Community Up for Retirement Enhancement (SECURE) Act—and its follow-up, SECURE Act 2.0—brought sweeping changes to how retirement accounts are treated under federal law. If you have an IRA, 401(k), or other tax-deferred retirement account, these changes may directly impact your estate plan.

The End of the “Stretch” IRA

One of the most significant changes under the original SECURE Act (passed in 2019) was the elimination of the "stretch" IRA for most non-spouse beneficiaries. Previously, a child or grandchild who inherited your IRA could take distributions over their lifetime, allowing the account to grow tax-deferred for decades. Now, most non-spouse beneficiaries must withdraw the entire account within 10 years of your death. This accelerates taxation and can lead to much higher income tax bills—especially for beneficiaries in their peak earning years. Certain individuals, including surviving spouses, minor children (until age 21), disabled or chronically ill beneficiaries, and beneficiaries not more than 10 years younger than you, may still be eligible for the stretch option.

Trusts as IRA Beneficiaries: Still Possible, But More Complex

Many people name trusts as beneficiaries of their retirement accounts to provide asset protection or to control distributions to young or vulnerable heirs. Under the SECURE Act, this is still possible—but it’s trickier. Trusts must be carefully drafted to qualify as “see-through” or “look-through” trusts, which allows the trustee to follow the 10-year rule rather than facing even more accelerated distribution requirements. Not all trusts qualify, and naming the wrong type of trust could result in unintended tax consequences. If you have a trust listed as a beneficiary of your IRA or retirement account, this is a critical time to review your documents.

SECURE Act 2.0: Increased RMD Ages and Roth Conversions

SECURE Act 2.0 raised the Required Minimum Distribution (RMD) age from 72 to 73 for individuals born between 1951 and 1959, and 75 for individuals born in 1960 or later. This gives more time for your retirement accounts to grow tax-deferred, and also creates opportunities for strategic Roth conversions before RMDs begin—especially in lower income years. Additionally, SECURE 2.0 allows unused funds from 529 plans to be rolled into Roth IRAs under specific conditions, making those education savings vehicles even more flexible.

If your estate plan was created before 2020—or if it includes retirement accounts or trusts—you should review it with an attorney familiar with the SECURE Act and how it interacts with Texas law.