IRA in transit
I have a unique question regarding RMDs.
I transferred IRA from 1 custodian to another on 26th December 2019.
The funds were in transit until 5th January 2020.
Hence on 31st December 2019, both custodians report $0.
RMDs are based on value 31st December 2019.
Does this mean that I do not have a RMD for 2020.
Or is the value based on the $ in transit.
I can also defer my RMDs according to the Care Act.
What is the date that I can defer same.
Permalink Submitted by Alan - IRA critic on Tue, 2020-11-03 19:12
There is an “outstanding rollover” rule when a distribution from the first year is rolled over in the second year. In that case the amount of the distribution must be added to the receiving IRA balance to calculate the second year RMD. While the IRS does not directly address transfers (no 1099R issued), the same rule should be applied based on the outstanding rollover rules applying to recharacterizations, which are done by transfers. However, since the RMDs for 2020 are waived, the outstanding rollover rule is immaterial with respect to 2020 RMDs. Therefore you have no 2020 RMD. It was the CARES Act that waived the 2020 RMDs. The only way you would have a 2020 RMD is making up a delinquent RMD for 2019 or earlier years.
Permalink Submitted by Dianne Corsbie on Tue, 2020-11-03 19:17
Thanks