Qualifying For CARES Act $100K IRA

Submitted by Greg Spencer on Mon, 2020-04-06 17:46

In reading about the provision that allows one to w/d $100k from a traditional IRA it says to be eligible you must be effected by the CV.

My situation:

I retired early. My wife still works. Her hours are cut back a bit and I had started looking for full-time employment again before this all broke. Tough now to find that employment.

Does that meet the qualifications? Can’t find anything on IRS site.

Thanks



Submitted by Alan - IRA critic on Mon, 2020-04-06 18:12

  • If your wife can reasonably state that her hours have been reduced due the virus (including lack of customers due to stay at home orders), she can report IRA distributions as CV related. In your case, you do not meet the existing definition, but those parameters are expected to be expanded by either the IRS or Congress. I expect that the IRS is working on releasing specific guidance fairly soon. 
  • Note that any taxpayer who takes such a distribution will have to deal with a special form to report it very similar to Form 8915B used for disaster distribution in recent years. This form is quite complex and includes the repayment options (roll back deadline 3 years after distribution), the option to pay taxes over 3 years or in 2020, the penalty waiver, etc. 

Submitted by Greg Spencer on Mon, 2020-04-06 20:45

Thank you

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