One of the provisions of the CARES Act waives Required Minimum Distributions (RMDs) due to be taken in 2020, from retirement accounts, including IRAs.

The waiver includes:

• RMDs normally required to be taken for 2020.
• Individuals who turned 70½ in 2019 but did not take their first RMD before January 1, 2020. In the absence of additional relief, the next RMD for those individuals must be taken by December 31, 2021.
• For purposes of counting the five-year period for beneficiary distributions, 2020 is disregarded and one year is added to the remaining period. For example, for deaths occurring in 2019, the five-year period in which the inherited assets must be distributed will end on December 31, 2025, instead of on December 31, 2024.
• A distribution that is taken in 2020-but that is not an RMD because of the waiver-may be rolled over to another eligible retirement plan or to an IRA within 60 days of the distribution.

The CARES Act waiver of the requirement to take an RMD could result in tax savings for many taxpayers. We encourage you to contact your financial advisor for the best strategy regarding your specific situation.