New Tax Relief for Required Minimum Distributions

The CARES Act, passed earlier this year, enabled any taxpayer with a Required Minimum Distribution due in 2020 from a defined-contribution retirement plan, including a 401(k), 403(b), or an IRA, to skip those RMDs this year.

Yesterday, the IRS issued Notice 2020-51, which provides tax relief to individuals who have already taken a required minimum distribution in 2020.

If you have already taken a Required Minimum Distribution in 2020, you have until August the 31st of 2020 to deposit the funds back into your retirement account which would allow you to classify the transaction as an indirect rollover. This means the distribution would not be a taxable event to you.

Full IRS Notice 2020-51 can be found here: https://www.irs.gov/pub/irs-drop/n-20-51.pdf

Steve Olson

Steve Olson CFP®, AEP® CEO | Family Wealth Advisor

Steve Olson’s experience spans over a decade of focused tax planning, legal strategy interpretation, investment management, and advisory services to wealthy individuals and families throughout the U.S. Over the course of his still young career, Steve provides counsel and management on individual assets and portfolios—encompassing a combination of securities, real estate, privately held businesses and other alternative investments—ranging in value from $5 million to over $400 million in value.

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