Skipping a mandatory distribution from your IRA? Everything you need to know
“This year, the coronavirus relief law is letting savers bypass mandatory withdrawals from their retirement accounts.” The one-year reprieve enables those who can afford to leave the money invested a better chance of recovering losses.
- The coronavirus relief bill allows savers to bypass any required minimum distributions they must take from their IRAs and workplace retirement plans in 2020.
- This RMD delay also applies to beneficiaries of inherited IRAs.
- A bonus: You don’t have to withdraw from the account during the current market rout.
Temporary relief applies to: traditional individual retirement accounts, 401(k), profit-sharing plans, 457 accounts, and 403(b) plans).
Additional details from the WSJ:
People who took required distributions since Feb. 1 may be able to use the so-called 60-day rule to return the money. To qualify, you normally have to put the money back within 60 days of receiving it. But the IRS allows anyone who took an RMD between Feb. 1 and May 15 to return the money by July 15.
The IRS reprieve doesn’t help retirees who took RMDs in January and want to put that money back in the accounts… unless the IRS issues more relief. Stay tuned.
In addition, the Secure Act, which took effect at the start of 2020, raised the RMD start age to age 72.
Get the details at: https://www.cnbc.com/2020/04/08/skipping-a-mandatory-distribution-from-your-ira-what-you-need-to-know.html
Source: Financial Planning for Women