Rollovers of Required Minimum Distributions (RMDs) Allowed Additional Time
The year 2020 has brought multiple unprecedented events and challenges due to the COVID-19 health crisis, and we are here to share another update that may impact your retirement investments. Thanks to the IRS Notice 2020-51, there is an option for those who took the Required Minimum Distributions (RMDs) to return those funds if they choose.
Many who have retirement funds, or inherited IRA’s, are required to take annual distributions known as RMDs. For some individuals these occur in the first part of a calendar year, so when the Coronavirus Aid, Relief, and Economic Security (CARES) Act suspended the requirement for the 2020 calendar year on March 27, 2020, it was too late for those who had already taken action to adhere to the annual requirements. Even when a relief measure was instituted that provided a 60-day period to return any distributed funds, it still excluded anyone who had received their RMDs before February 1, 2020.
To assist taxpayers who already received their RMDs on January 1, 2020 or later, the IRS has now extended that 60-day deadline to return those funds, tax-free, to IRAs or other qualified plans. For any taxpayer who took an RMD distribution in 2020, now has the later date of August 31, 2020, or 60 days after the receipt of the distribution, to return those funds. This update will reduce taxpayers’ annual tax bill and provide some peace of mind for retirement planning as we all navigate these uncharted waters.
Our team at MNMW is working constantly to bring you the most recent news and updates related to the COVID-19 crisis that could impact you and your loved ones. In a continuing effort to maintain the health and safety of our valued clients, our team, and the community and to cooperate with the advice of health officials, MNMW lobbies in Fort Myers and Naples will be closed to the public until further notice.
For more information you can visit our MNMW Coronavirus (Covid-19) Resource page with the button below or call in at (239) 433-5554.