CARES Act and Changes to Required Minimum Distributions
Brandon R. Bishop | Posted: May 7, 2020
Recently, the Coronavirus Aid, Relief, and Economic Security Act, more commonly known as the CARES Act, was signed into law. Some aspects of the coverage revolve around rebate checks, the postponement of tax filing season, as well as one significant change we wanted to bring to your attention.
Per the CARES Act, individuals will see a temporary waiver of Required Minimum Distribution (RMD) Rules for 2020. More simply, RMDs on accounts that are RMD eligible (IRAs, Inherited/Beneficiary IRAs, 401(k)s, 403(b)s and governmental 457(b) plans) will not need to be satisfied for this calendar year. This provision of the CARES Act is applicable to all individuals, not just those who are affected by the coronavirus.
What does this mean for you and your RMD?
If you have your RMD set up to process automatically, either through monthly income or a one-time scheduled distribution, but don’t feel you will need it, please contact your advisor to discuss what steps may be needed to adjust your standing instructions. If you already satisfied your RMD for 2020 and are wondering if you have options available to you, please reach out to your advisor.
Additionally, individuals will still be able to gift to charities directly from their IRAs. Qualified Charitable Distributions (QCD) can count towards an individual’s RMD requirement. It is important to note that you don’t need to have an RMD to be able to make a QCD. Consult with your advisor to see if continued gifting from your IRA still makes sense for this year.
Stay safe and stay healthy,
Bernicke Wealth Management
About the author
Brandon is a Wealth Manager who strives to ensure the highest level of service for clients through investment management, income planning, and the implementation of potential tax minimization strategies. Brandon values strong relationships, attention to detail, and excellent customer service. While outside of the office, Brandon enjoys traveling to new places, cheering on his favorite sports teams, a round of golf, and spending time with his family.
Certifications, Licenses, and Registrations
- Registered Representative with Triad Advisors, LLC
- Accident, Life, Health, and Variable Life/Variable Annuity Insurance Licenses
Education and Training
- Series 7, 66
- Bachelors Degree - Business Economics (Minor in Finance); University of Wisconsin - Eau Claire