RMDs Waived for 2020 as part of CARES Act

The $2 trillion relief package titled, “Coronavirus Aid, Relief, and Economic Security Act,” CARES ACT enacted recently Included in the massive bill are several relief provisions for retirement accounts. The one that will affect most retirees is the waiver of RMDs for 2020.

This is a huge help because 2020 RMDs would generally be based on the substantially higher account values at December 31, 2019. Here’s how: The Dow closed at 28,462 on December 31. As of March 26, the Dow was hovering around 22,000. If not for this relief, IRA owners would be forced to withdraw and pay tax on a much higher percentage of their IRA balance. Eliminating the RMD for 2020 can help clients reduce their 2020 tax bill.

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