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Required Minimum Distributions Suspended For 2020 following the CARES Act by Julie Jason

Are you withdrawing from your IRA or 401(k) because you must, due to “RMD” rules?  

RMDs (required minimum distributions) are mandated by the tax laws. They apply to “owners” of an IRA or 401(k), beginning when they are in their 70s (age 72 if you were born after June 30, 1949; age 70 1/2 if you were born before July 1, 1949). RMDs apply regardless of age to those who inherit from an IRA owner.  (Note that there are special rules for spouses who inherit.)        

Because of the CARES Act (Coronavirus Aid, Relief, and Economic Security Act) that was just signed into law on March 27, 2020, RMDs for everyone with IRAs and 401(k)-type accounts (but not defined benefit plans) are suspended for 2020. 

There are no exceptions in the provision, which you can read in Section 2203 of the CARES Act, “Temporary Waiver of Required Minimum Distribution Rules for Certain Retirement Plans and Accounts.”  Read the full act here.

And the law says 2020, meaning the suspension of RMDs is effective for the full year —Jan.  1, 2020, to Dec. 31, 2020.  

That brings up some practical questions, the answers to which may still evolve, depending on whether the IRS issues guidance.      

Read Hayden Adams’ thoughts in SCFR’s "Can You Forgo Taking RMDs in 2020?" (April 2, 2020)


To read Julie Jason's books, go to https://juliejason.com/books/julies-books.