Our daily roundup of retirement news your clients may be thinking about.

Closing the loophole behind $10 Million tax-free retirement accounts

The Internal Revenue Service is considering regulations to limit the assets in IRAs, as fewer than 1,100 accounts have outsized balances, according to this article on Time Money. The agency received a recommendation from the General Accounting Office to put a ceiling to IRA account balances to give all taxpayers equal chance at retirement saving and ensure that the tax-advantaged assets will not be more than enough for retirees to secure a comfortable life in their golden years. –Time Money

6 ways you can make a penalty-free 401(k) withdrawal

401(k) participants will face a 10% penalty for an early, non-qualified withdrawal, except when they intend to use the money to buy a primary home, cover funeral expenses, pay college costs, and settle medical bills, according to Motley Fool. The employer may allow early 401(k) withdrawal without imposing the penalty if participants become disabled, need to give money to a loved one as required by a court of law, and are separated from their jobs and want to take out "substantially equal amounts" throughout their lifetime. They may not also pay the penalty if they take an early withdrawal to pay medical debt that exceeds 7.5% of their adjusted gross income, or they are separated from their job at age 55 or later, and they want take a loan. –Motley Fool

PBGC guarantees 401(k) rollovers to pensions

Workers are now allowed to roll their 401(k) assets into their pension plans, with a portion of the rollover guaranteed by the Pension Benefit Guaranty Corp., according to this article on USA Today. The rollover is likely to boost the pension payment, but the $60,165 limit will not apply to the increase under the new rules. In case the pension fails, those who made a 401(k) rollover would still receive up to $60,125 in pension payment and additional amount from an annuity in lieu of the rollover from the PBGC. –USA Today

Strategy spurs rethink on San Diego pension’s oversight

The investment strategy proposed by an outside firm hired by the San Diego County Employees Retirement Association prompted the board to terminate the contract with the firm and install an internal investment chief, according to The Wall Street Journal. The outside firm, Houston-based Salient Partners, recommended a strategy that aims to boost investment performance by relying on derivatives. Pension funds' relationships with outside companies that manage their assets or provide guidance on investments are increasingly getting public attention as retirement systems struggle with their obligations to better serve retired workers. –The Wall Street Journal

Social Security Q&A: With a pension and income, are spousal or retirement benefits better at 66?

A 64-year-old retiree who receives a pension is advised to file for a spousal benefit on her husband's record when she reaches 66 if the spouse is already receiving his own retirement benefit, according to an article on Forbes. She may then file for her own retirement benefit when she turns 70. The benefit she will receive at that time will be based on her retirement benefit and excess spousal benefit. -Forbes

Read More: