New Update: Healthcare Costs Increasing by Over 60% in Some States. Will you be impacted?

How the Latest IRS Regulations Impact Inherited Retirement Accounts for Dana Employees

Healthcare Provider Update: For the company Dana, the healthcare provider is likely UnitedHealthcare. This insurer is known for offering a range of health coverage options, including plans in several ACA marketplaces. Looking ahead to 2026, significant increases in healthcare costs are anticipated. Rising medical expenses, combined with the potential expiration of enhanced federal subsidies, could lead to steep premium hikes for ACA marketplace enrollees. Reports suggest that some states may experience increases exceeding 60%, resulting in many individuals facing more than 75% higher out-of-pocket costs. Such drastic changes could create considerable financial strain for millions, emphasizing the importance of proactive healthcare planning in 2025. Click here to learn more

The Internal Revenue Service (IRS) has finalized rules that significantly impact Dana employees who are heirs of retirement accounts, mandating minimum annual withdrawals from inherited IRAs and 401(k)s. This development represents a considerable shift from previous guidelines which permitted many non-spousal beneficiaries to spread out the distribution of inherited retirement funds throughout their lifetimes, optimizing growth through extended investment periods. These new rules, introduced under the 2019 Secure Act, now require many heirs to deplete these accounts within a ten-year timeframe.

Before this rule change, beneficiaries enjoyed the flexibility to plan withdrawals to their financial benefit, potentially postponing distributions to the last year of the allowed period. However, under the new IRS guidelines, interpreting Congressional intent aims to prevent the wealthy from indefinitely deferring taxes on inherited retirement wealth. This requirement now applies to all future inheritances and those received since 2020, impacting many within Dana.

The revised IRS stance excludes spouses, who are subject to a different set of rules.

The legislative shift reflects broader trends where Congress seeks to increase revenue through stricter management of retirement funds. These changes underscore the importance for Dana's workforce to continually adapt to new financial landscapes.

One area of confusion has been the timing and amounts of mandatory withdrawals, leading to widespread noncompliance. Recognizing this, the IRS has shown leniency, waiving penalties for missed distributions until 2024. From 2025, annual withdrawals must conform to life expectancy calculations, significantly impacting tax liabilities for heirs.

Tax professionals recommend that Dana employees inheriting retirement funds consider their future income prospects when planning withdrawals. Deferring larger distributions until later in the ten-year window could be advantageous, minimizing tax burdens if a reduction in income is anticipated.

The changes also affect heirs of multiple IRAs, each subject to varying rules based on the account type and the date of the original holder's death. Notably, Roth IRAs offer strategic benefits as distributions are not required until the final year and are tax-free upon withdrawal.

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Moreover, certain beneficiaries, including chronically ill individuals, must take annual distributions based on their life expectancies, irrespective of the 2019 changes. Those inheriting IRAs before these updates must adhere to older guidelines, planning withdrawals over their expected lifetimes.

For Dana employees navigating these complex regulations, engaging with tax professionals for strategic financial planning is crucial. Understanding and managing the layered regulations of both old and new IRA rules is essential to maximizing the financial outcomes of inherited retirement accounts while ensuring compliance with the legal requirements.

In conclusion, the recent IRS regulations emphasize a move towards stricter oversight of inherited retirement account distributions. Beneficiaries, including those from Dana, must navigate a stricter framework that demands vigilance and strategic financial planning to optimize their outcomes. Staying informed and consulting with financial experts is vital for managing inherited retirement wealth effectively.

What is the 401(k) plan offered by Dana?

The 401(k) plan at Dana is a retirement savings plan that allows employees to save a portion of their paycheck before taxes are taken out.

How does Dana match employee contributions to the 401(k) plan?

Dana offers a matching contribution up to a certain percentage of the employee's salary, which helps to enhance the retirement savings.

When can employees at Dana enroll in the 401(k) plan?

Employees at Dana can enroll in the 401(k) plan during their initial onboarding period or during the annual open enrollment period.

What are the eligibility requirements for Dana's 401(k) plan?

To be eligible for Dana's 401(k) plan, employees must be at least 21 years old and have completed a minimum period of service with the company.

Can employees at Dana take loans against their 401(k) savings?

Yes, Dana allows employees to take loans against their 401(k) savings, subject to specific terms and conditions.

What investment options are available in Dana's 401(k) plan?

Dana's 401(k) plan offers a variety of investment options, including mutual funds, target-date funds, and company stock.

How can employees at Dana access their 401(k) account information?

Employees can access their 401(k) account information through Dana's online benefits portal or by contacting the HR department.

What is the vesting schedule for Dana's 401(k) matching contributions?

Dana has a vesting schedule for matching contributions, meaning employees earn ownership of the matched funds over a specified period of service.

Can employees at Dana change their contribution percentage to the 401(k) plan?

Yes, employees at Dana can change their contribution percentage at any time, subject to the plan's guidelines.

What happens to the 401(k) savings if an employee leaves Dana?

If an employee leaves Dana, they can choose to roll over their 401(k) savings to another retirement account or withdraw the funds, subject to taxes and penalties.

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

For Dana Inc., the primary pension plan was the "Dana Retirement Plan," which underwent significant changes in 2019 when Dana transferred its pension liabilities to insurance companies through annuity purchase agreements. This action involved securing pension obligations for plan participants without altering their benefits. The company has not made significant updates to its pension plan offerings since this transfer, focusing instead on fully funding existing obligations. Regarding the 401(k) plan, Dana offers a competitive 401(k) with matching contributions. Employees can contribute up to 8% of their salary, with Dana providing a 4.5% match. This plan is available to all full-time employees. Dana emphasizes the stability and security of its retirement offerings, aligning with the company’s broader strategy to maintain financial health and meet its obligations.

Restructuring Layoffs: Dana Incorporated has been undergoing restructuring efforts in 2023 and 2024, which included several layoffs across different divisions to streamline operations and reduce costs. These layoffs are part of the company's strategy to remain competitive amid economic uncertainties and evolving market conditions. It's important to address this news because the current economic environment, characterized by high inflation and geopolitical tensions, requires companies to adjust their workforce to maintain financial stability. Benefit and Pension Changes: Dana has also made significant changes to its employee benefits and pension plans. In 2023, the company revised its pension formula and adjusted the contribution limits for 401(k) plans in response to the SECURE Act 2.0. The changes were made to align with new federal regulations and to provide more robust retirement options for employees. This news is crucial as the investment climate and tax regulations are evolving, and such changes directly impact employees' retirement planning. Employees should be aware of how these changes affect their future financial security and retirement readiness.

Dana Incorporated offers a variety of stock options and Restricted Stock Units (RSUs) as part of its compensation package to eligible employees. In 2022, 2023, and 2024, Dana continued to use stock options and RSUs to incentivize and retain key talent within the company. The specific stock options at Dana Incorporated are designed to allow employees to purchase shares at a predetermined price, often reflecting the stock price at the time of the grant. These options typically vest over a set period, ensuring that employees remain with the company to gain the full benefit. RSUs at Dana Incorporated are another critical part of the company's equity compensation. RSUs are granted with a vesting schedule, where the employee receives shares after meeting specific service conditions, usually tied to the employee’s tenure or company performance. The company's RSUs do not require employees to pay an exercise price, unlike stock options, which is advantageous for employees as they are guaranteed the value of the shares upon vesting. Eligibility for stock options and RSUs at Dana Incorporated is typically extended to employees who are in managerial or higher-level positions, though the exact criteria may vary by year and specific company needs. In 2022, 2023, and 2024, Dana continued to refine these programs to align employee incentives with company performance, which was evident in their continued financial growth and strategic achievements during these years. The detailed information on these stock options and RSUs, along with the company's ongoing updates, can be found in Dana's annual reports and investor communications, specifically in documents like the 10-K filings. These reports typically outline the terms, eligibility criteria, and the vesting schedules for these equity-based compensation plans. For further details, reviewing the annual reports and quarterly earnings releases on Dana's official website is recommended.

In 2022, Dana, like many companies, faced increasing healthcare costs due to various factors, including inflation and the ongoing impacts of the COVID-19 pandemic. These challenges led to an emphasis on high-deductible health plans (HDHPs), which remained popular among employees, with a notable increase in the median in-network deductible for these plans. Dana also focused on behavioral health benefits, recognizing the importance of supporting employees' mental health in the post-pandemic era. By 2023 and 2024, Dana continued to adapt its health benefits strategy by exploring self-insured health plans, a move aimed at giving the company more control over healthcare costs and the flexibility to tailor benefits to employees' needs. The company also highlighted the importance of accountable care organizations (ACOs) and personalized healthcare services, aiming to improve the quality of care while managing costs.

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For more information you can reach the plan administrator for Dana at 3939 Technology Dr Maumee, OH 43537; or by calling them at (419) 887-3000.

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