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IRS Provides Relief for Retirees on Required Minimum Distributions (RMDs)
July 01, 2020Retirees, have you taken an RMD from your retirement accounts this year? The IRS has announced that you have the opportunity to roll over the RMD into a plan or IRA by July 15, 2020.
Attention retirees…did you take required minimum distributions (RMD) from your retirement accounts this year? Recently, the IRS announced that taxpayers who took an RMD between February 1, 2020 and May 15, 2020 now have the opportunity to roll over the RMD into a plan or IRA by July 15, 2020 without owing any tax or penalties. This means that the usual 60-day rule for rollovers is waived.
Important background
Have you read our blog, CARES Act Changes Rules for RMDs for 2020? In the past, you had to take your first RMD by April 1st of the year you turn 70 ½. The SECURE Act raised the age to 72. Under the CARES Act, RMDs are waived for IRA owners who turned 70 ½ in 2019 and who were planning on taking their distribution by April 1, 2020.
What’s inside IRS Notice 2020-51?
Now recently issued IRS Notice 2020-51 provides further opportunity. Specifically, this new notice –
- Allows tax-free rollovers for required minimum distributions received in January 2020
- Waives the one-a-year limit for IRA rollovers
- Opens up rollovers to non-spouse IRA beneficiaries
You must complete the rollover by August 31, 2020 – no questions asked by the IRS.
Questions? Contact us.
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