Retirement Plans and Tax-Advantaged Accounts: Rapid Fire

What this video covers

• Why a 457(b) plan never carries a 10% early withdrawal penalty, and how this differs from every other employer plan and individual retirement account (IRA)
• How qualified plans meet Internal Revenue Code and Employee Retirement Income Security Act (ERISA) standards for non-discrimination and creditor protection, while non-qualified plans favor executives and expose assets to employer bankruptcy
• Who bears investment risk in defined benefit plans versus defined contribution plans, and why the Pension Benefit Guaranty Corporation (PBGC) only backstops defined benefit plans
• The 60-day rollover mechanics: mandatory 20% withholding, why the participant must replace the withheld amount from other funds, and the once-per-12-months IRA-to-IRA limit
• How the pro-rata rule prevents cherry-picking after-tax basis across commingled traditional, Simplified Employee Pension (SEP), and SIMPLE IRAs
• The 2026 elective deferral limit ($24,500), total annual addition cap ($72,000), required minimum distribution (RMD) start age (73), and the elevated 25% early withdrawal penalty for SIMPLE IRAs in the first two years
• Which penalty exceptions apply to employer plans only (age-55 separation from service), which apply to IRAs only (first-time home purchase, higher education), and how net unrealized appreciation (NUA) converts company stock growth to long-term capital gains treatment