SECURE 2.0: What Public Service Employers Need to Know

On Dec. 29, 2022, the Setting Every Community Up for Retirement Enhancement (SECURE) 2.0 Act was signed into law. SECURE 2.0 is part of the Consolidated Appropriations Act of 2023 and is designed to improve retirement savings options. MissionSquare Retirement applauds its passing and is your partner in navigating its provisions and optimizing its impact for you and your employees.

What Actions Do Employers Need to Take?

Here are the key SECURE 2.0 provisions requiring action now and what you need to know.

Secure 2.0 Checkmark

Prepare Your Plan for Roth Catch-Up Contribution

If your plan offers catch-up contributions, you’ll need to amend your plan to include Roth age-based catch-up contributions before Jan. 1, 2026.* SECURE 2.0 requires this feature for employees making over $145,000 per year.

*On Aug. 25, 2023, the IRS delayed the Roth catch-up contribution start date from Jan. 1, 2024 to Jan. 1, 2026.

Secure 2.0 Checkmark

Review RMD Age Requirements

Starting Jan. 1, 2023, the Required Minimum Distribution age increased to 73 and will continue to increase in the coming years. Increasing the RMD age means funds may continue to grow in a retirement account, enabling retirees to improve their financial future.

Date of Birth RMD Age
Dec. 31, 1950 and earlier No changes to current RMD schedule.
Jan. 1, 1951 to Dec. 31, 1958* 73 years old
Born Jan. 1, 1960 or later 75 years old

*The RMD age for those born in 1959 was not clear in SECURE 2.0. MissionSquare expects regulatory or legislative clarification this year.

Be sure to update your materials to reflect the new requirements. We’ll also be notifying affected employees about the change.

When Do SECURE 2.0 Provisions Take Effect?*

The timing of the new provisions varies. Here’s a breakdown of what’s starting this year and what’s ahead.
  • RMD age increases
  • RMD excise tax reduction
  • Eliminate the 457(b) "First day of the month" rule
  • Withdrawal for federally declared disasters
  • Exclusion (up to $3,000) for health insurance payments for retired public safety
  • Expansion of 10% additional tax exception for public safety officers at age 50
  • Self-certification for Hardship and Unforeseeable Emergency Distributions
  • Exemption of pre-death RMDs from Roth accounts
  • Surviving spouse treated as the employee
  • Penalty-free withdrawals for domestic abuse victims
  • EPCRS: Safe harbor for corrections of automatic deferral failures
  • Treatment of student loan payments as elective deferrals for purposes of matching contributions
  • Withdrawals for certain emergency expenses
  • Emergency savings accounts linked to individual account plans
  • Updating dollar limits for mandatory distributions
  • Exemption for certain auto-portability transactions
  • Rollovers from 529 plans to Roth IRAs
  • Catch-up contributions must be made on a Roth basis
  • Higher catch-up contribution limit to apply for ages 60 to 63
  • EPCRS: Expansion
  • Reduced service requirement for long-term, part-time employees
  • Saver’s Credit and promotion of Saver’s Credit
  • Plan amendments
*Effective dates are generalized for illustrative purposes and vary depending on the provision.

SECURE 2.0 Resources

We’ve reviewed SECURE 2.0 through the lens of public service employers, identifying the provisions and opportunities unique to you and your employees.

Webinar Series: 2023 Governmental Plan Implementation

Recorded August 2023

Review frequently asked questions and discuss actions to align your plan.

Watch Now

Frequently Asked Questions

Get answers to common questions about the mandates.

Read the FAQ

An Employer’s Guide to SECURE 2.0

An Employer’s Guide to SECURE 2.0

Access a printable document highlighting important provisions and key dates.

Get the Guide

Webinar Series: 2023 Governmental Plan Implementation

Recorded April 2023

Learn steps for implementing new provisions in your plan.

Watch Now

Webinar: What Governmental Plans Need to Know

Recorded January 2023

Understand how SECURE 2.0 enhances your plan and upcoming changes.

Watch Now

Secure 2.0 Articles

Washington Perspective: SECURE 2.0 Articles

View our commentary on the passage of SECURE 2.0 and other legislation affecting your plan.

Read the Latest

MissionSquare Retirement does not offer specific tax or legal advice. The information presented here is for educational purposes only and is not to be construed or relied upon as investment advice. It is recommended that individuals consult with their personal finance advisor prior to implementing any financial or tax strategy.
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