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New Rollover Rules for 2020 RMD's

When the US Senate passed the Coronavirus Aid, Relief and Economic Security (CARES) Act in early 2020 it gave many individuals who are required to take RMD’s (Required Minimum Distributions) the ability to halt those distributions for the year. Those that had already taken their distributions and fell into the 60 day rollover window had the option of returning those funds, but those that had taken funds right at the beginning of the year (or were taking monthly distributions) were put in a category of uncertainty as to whether those funds could be put back into their accounts.

The IRS recently released Notice 2020-51 which aims to clear up some of the confusion on previously taken RMDs. The most relevant portions of this topic are the extension of the 60-day rollover window to be the later of 60 days after the distribution was received or August 31, 2020, and allowing ALL unwanted 2020 RMDs to be returned. Previously, Notice 2020-23 only included distributions taken February 1, 2020 or later. This left those that took distributions in January 2020 stuck with having to keep those distributions.

Another group that will benefit from this notice are non-spouse beneficiaries of IRAs. These individuals were previously prohibited from using the 60-day rollover rule. With this notice non-spouse beneficiaries have been given the green light to ignore the rollover rule and reinvest any RMD amounts taken in 2020.

The notice further states that rollovers taken during 2020 are not being counted as a rollover for purposes of the once per year rollover rule. Since the rollover rules look at a 365 day window and not just one calendar year to the next, this portion of the notice allows those that made a rollover during the last 365 days a chance to return any RMD that they took as well as helping those that have taken a monthly distribution during 2020 and would like to put those RMDs back into their accounts.

The key point from all of this is that ANY required minimum distribution taken during 2020 can now be returned to a retirement account. If you have taken an RMD during 2020 and would like to return those funds to your account please reach out so we can assist you. Additionally, if you have any questions regarding your RMD in general we are here to help.

Please check with your Curran Wealth relationship manager,
or contact Curran Wealth Management if you have any questions.
 518.391.4200 •

The material contained in this article is for educational and informational purposes only.  The information herein is considered to be obtained from reference sources deemed reliable, but no representation or warranty is made as to its accuracy or completeness.  This article is not, and should not be regarded as “investment advice” or construed as a “recommendation” or an offer to buy or sell a security.  The information contained in this article may not apply to your personal circumstances.  Before making any decision or taking any action, you should consult a professional advisor who has been provided with all pertinent facts relevant to your particular situation.  Information on taxes is based on the tax laws existing at the time of publication.  Tax laws are subject to continual change.  In addition, tax laws vary by state.  This article is not, and should not be regarded as tax or legal advice.  We cannot ensure tax consequences of any transaction.  If you would like a detailed analysis of your tax situation, with specific tax recommendations, you can discuss the possibility of pursuing a formal relationship with Hippo Tax Services, LLC.