Did you know that the CARES Act of 2020 impacts your retirement?
Here are some fun facts:
Some Social Security beneficiaries will receive “Recovery Rebates.”
RMDs are not due for 2020. Period. IRAs, 401(k)s, 403(b)s, and 457s are also on hold.
Mixed with the SECURE Act provision, what does this mean for RMDs in 2020?
Q: Do you have to delay withdrawals? What if you need them to live on?
Absolutely not! They’re simply optional, not mandatory.
Q: Are there tax advantages to taking a distribution in 2020, even if it’s not mandatory?
One of our basic rules is: defer RMD income for as long as possible, unless you need it to live on. Consider taking the RMD pause as an opportunity to convert traditional IRA assets to Roth.
Q: Are qualified charitable distributions allowed for 2020?
Yes! As long as you are over the age of 70.5, you can contribute up to $100,000 of your RMD to charity. Note: this no longer “satisfies” your RMDs, since they’re not mandatory for 2020, but it does still allow pre-tax donations to charity.
Q: What if I turned 70.5 in 2019, but delayed my first RMD from 2019 to April 1st, 2020?
Yes! The CARES Act applies to any RMD that would have been taken in 2020, so you can avoid both your 2019 and 2020 RMD withdrawals.
Q: I already took my RMD for 2020! Can I put it back?
Possibly… If you took your RMD between February 1st and May 15th, there is an option – until July 15th, 2020 – to move it back into an IRA.*
*Only one such rollover is allowed per 12-month period, so this may not be an option for you. This is also not allowed for inherited RMDs.
You worked hard for your Social Security benefits.
And perhaps you even worked harder for your financial investments.
It’s more critical than ever to safeguard them properly!
Learn and grow with us.
Develop custom retirement strategies that will protect you.
Plan a virtual consultation with Abe and Shelly Abich! Or, attend one of our upcoming webinars or online workshops.
You aren’t in this alone. We’re here to help.