Wealth Management Firm Near Me - Facebook Icon IMG  Wealth Planning Near Me - Twitter Icon IMG   Find A Financial Advisor Near Me - Linkedin Icon IMG 

678.971.1337

Access Your Account Online

☰ Menu
Planning & Economy

CARES Act Relief for IRA Account Holders – What does it mean to you?

April 23rd, 2020

There were several items that went into the CARES Act, but there are a few items that I would like to focus on specifically.

Temporary Waiver of 2020 Required Minimum Distributions (RMD)

This is great news for investors that begrudgingly withdraw from their IRA accounts every year because the IRS requires them to do so. These investors will be able to save on taxes as any withdraws from an IRA account or retirement plan account is taxed at ordinary income.  The 2020 RMD waiver is also approved for IRA Beneficiary Accounts as well.  Remember, if you are required to take an RMD you can donate your RMD amount to a church or any 503c organization and make your distribution tax-free.  This is a great way to make donations to your favorite charities.

If you are a client of ours please let us know if you would like to waive your RMD this year as there is some paperwork for you to complete.

60-Day Rollovers for IRA Accounts

As an IRA owner you have the ability to make a withdraw form your IRA and put the money back in within 60 days without having to pay the distribution taxes or penalties.  Under the CARES Act the IRS is extending the 60-day rollover deadline.  If you took a withdraw and your rollover deadline is between April 1, 2020 and July 15, 2020 then your new deadline is July 15, 2020.  There is still only one “60-day rollover” allowed in a 12-month period.  If you have additional questions about this, please let me know.

10% Premature Distribution Penalty Waived for Certain Coronavirus-Related Distributions in Retirement Accounts

Although I do not recommend making withdraws from a retirement plan prior to retirement unless there is a real financial hardship, there is relief from the IRS for families that need to make a distribution from their retirement plan.  There are strict limits on who can take a distribution under this Act – those individuals who have contracted COVID-19 or the spouse or dependent of that individual as well as an individual who has experienced financial hardship from the Coronavirus pandemic or any other factors determined by the Secretary of the Treasury.  These individuals are allowed to take up $100,000 in 2020, but there is a three-year repayment period beginning the day after the distribution.  Raymond James is still waiting to hear more information from the IRS about the process for IRA accounts.

The CARES Act will help many in need; if there is anything we can do for you or a family member please let us know.

Sincerely,

Christina Jones

CERTIFIED FINANCIAL PLANNER™

Financial Planner

Partner, DJWMG

 

Securities offered through Raymond James Financial Services, In., Member FINRA/SIPC.  Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Windsor Wealth is not a registered broker/dealer, and is independent of Raymond James Financial Services. Raymond James financial advisors may only conduct business with residents of the states and/or jurisdications for which they are propertly registered.  Therefore, a response to a request for information may be delayed.  Please note that not all of the investments and services mentioned are available in every state.  Investors outside of the United States are subject to securities and tax regulations within their application jurisdications that are not addressed on this site.  Contact your local Raymond James office for information and availability. Links are being provided for information purposes only.  Raymond James is not affiliated with and does not endorse, authorize or sponsor any of the listed websites or their respective sponsors.  Raymond James is not responsible for the content of any website or the collection or use of information regarding any website's users and/or members.