IRA RMD 2020 NO REQUIREMENT FOR DISTRIBUTION 2020

Submitted by ELEANOR COHEN on Fri, 2020-04-03 17:22

IF IRA RMD WAS PAID OUT WILL THE 60 DAY ROLLOVER APPLY SINCE RULING FOR NO REQUIREMENT WAS NOT MADE PUBLIC UNTIL END OF MARCH? WILL THE IRS FORGIVE A LONGER THAN 60-DAY ROLLOVER BACK INTO IRA ACCOUNT DUE TO THE CORONOVIRUS RULINGS?



Submitted by Alan - IRA critic on Fri, 2020-04-03 22:49

Probably, but they first have to define what qualifies as a CV related distribution if you do not meet the obvious directly impacted situations now. Hopefully, the IRS clears this up soon or perhaps Congress will issue a technical corrections bill that simply allows anyone to complete 3 year rollovers. That would erase the 60 day and the one rollover limitation problems.

Submitted by ELEANOR COHEN on Sat, 2020-04-04 22:00

What is a 3 year rollover? 

Submitted by Alan - IRA critic on Sun, 2020-04-05 02:01

If a distribution qualifies as a Corona virus related distribution (CVD), the taxpayer can choose to either report the entire distribution in current year income as usual, or report 1/3 of the distribution in 2020, 2021, and 2022.  In addition the taxpayer can roll back any portion of the distribution in the 3 year period following the date of distribution. If such a rollover is completed in a later year and the income is being reported over 3 years, then the earlier returns will have to be amended to receive a refund. There is a complex tax form required to report CVDs and all these income reporting and rollover options.

Submitted by Kerry Schepers on Thu, 2020-04-09 20:17

If RMD has already come out for 2020, they can put it back?  But then they bear the responsiblity of proving a CV reason and have to fill out a complex tax form?  Or…it’s just okay to send it back?  Thank you

Submitted by Alan - IRA critic on Thu, 2020-04-09 20:54

  • If the distribution has been made, it can be rolled back within 60 days if the person has not already used up their one allowed rollover over the last 12 months. This rollover can be reported on line 4 of Form 1040 as in past years.
  • However, if they don’t meet these requirements, then they need to qualify for a corona virus related distribution. Rolling back these distributions requires a fairly complex additional form to be filed with the tax return (similar to Form 8915B) and probably a different form to be included with the rollover contribution so the custodian can assign the correct IRS required code to it in the case of a rollover to an IRA.

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