RMD Waived / 60 Day Rule

Submitted by Gil Shifrin on Sun, 2020-04-12 15:31

I withdrew my RMD in January. Is there any changes in the 60 day rule in the CARES act. I would like to pay back some of the RMD thatI took in January.



Submitted by Alan - IRA critic on Sun, 2020-04-12 15:56

  • The IRS in Notice 2020-23 stated that distributions made starting in February now have until 7/15 to be rolled back. That was based on actions with a 4/1 or later deadline. Unfortunately, a January distribution, even when done 1/31 had a rollover deadline prior to 4/1. No help for January distributions taken an RMDs that turned out not to be RMDs after all.
  • That said, a January distribution might qualify as a corona virus distribution if you qualify for it according to CARES. And the IRS may broaden the eligibility for these distributions, which is widely expected. Once you qualify you have 3 years to roll the January distribution back. Therefore, keep monitoring the IRS site or varius sites like this for any updates.

Submitted by Gil Shifrin on Tue, 2020-06-23 20:54

I withdrew 44100 from my IRA in January 2020. I did a second withdrawal of 400 in February 2020. The first withdrawal in January was equal to my total RMD requirement.Based on the latest notification that was released today  I can rollback the 44100 in one lump sum or several rollbacks by 08/31/2020. The amount I can rollback will exclude taxes taken in January of 4410. So my maximum rollback amount would be 39690. Also I cannot rollback February’s withdraw because it is not an RMD. Is all of this correct? 

Submitted by Alan - IRA critic on Wed, 2020-06-24 01:07

The amount you can roll back per Notice 2020-51 is the entire 44,100 would be RMD.  You would have to come up with the 4410 from your other funds to make the rollover complete. This rollover would not count against the one rollover rule. Because of that you could also roll back the Feb distribution of 400 by 7/15 per the original CARES Act extended deadline for time sensitive actions. This 400 would be subject to the one rollover limit, and you might qualify but also may not want to use up your one permitted rollover subject to the limit for such a small amount.

Submitted by Gil Shifrin on Sun, 2020-04-12 21:49

Thanks for the quick response. You mention that IRS may broaden eligibility. Does that mean they may accept January’s RMD? If they do I will take back part of my January RMD in 2020. I expect I can reduce my income for 2020 by taking back some of January’s RMD If allowed.

Submitted by Alan - IRA critic on Sun, 2020-04-12 23:23

Add new comment

Log in or register to post comments