Rollover Relief for Required Minimum Distributions from Retirement Accounts

Taxpayers that have already taken a required minimum distribution (RMD) in 2020 from their retirement accounts before the CARES Act was enacted can roll the funds back into the retirement account. The deadline is August 31, 2020 to take advantage of the rollover for RMDs taken this year.

secure actUnder the CARES Act, RMDs due in 2020 from a defined-contribution retirement plan can be skipped this year by taxpayers. Taxpayers that turned age 70-1/2 in 2019 and would have had to take the first RMD by April 1, 2020 are eligible. The retirement plans include 401(k)s, 403(b)s, or IRAs, but doesn’t apply to defined-benefit plans.

An IRA owner or beneficiary who already received a distribution from an IRA of an amount that would have been an RMD in 2020 can repay the distribution to the IRA by August 31, 2020. The repayment is not subject to the one rollover per 12-month period limitation and the restriction on rollovers for inherited IRAs.

Read the IRS Notice 2020-51 here.

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