OK To Roll Back Part of A Recent TIRA Distribution?

Submitted by fairira on Fri, 2020-12-18 21:48

On 7/2/20 in your reply headed “The withholding is a deposit” you said: “Notice 2020-51, which allows those who took January distributions that would have been RMDs as well as later RMD distributions to roll them back by 8/31. The 60 day time limit and the one rollover limit in 12 months does not apply to these rollovers as indicated in the Notice. . . .”

On 6/25/20 I rolled back part of a Jan. 2020 TIRA distribution to my only TIRA. I made no other rollbacks in 2019 or 2020. Two days ago I took a distribution of $13,000. from the TIRA.

Can I in the coming week roll back $1,500. of that $13,000. TIRA distribution to reduce my 2020 AGI and taxable income?

Thank you very much for your help.



Submitted by Alan - IRA critic on Sat, 2020-12-19 01:12

Assuming that in June you did not roll back more than what would have been your RMD for 2020 had these RMDs not been waived, that rollover does not count against the one rollover rule. This allows you to roll back all or part of your Dec distribution within 60 days of receipt of that distribution. If you do not get it rolled back before year end, it would be considered an “outstanding rollover” and have to be added back to your actual 12/31/2020 balance used for computing your 2021 RMD. Probably best to roll it back next week if you can, AND if this rollback warrants incurring another 12 month waiting period before you can do another such 60 day rollover.

Submitted by fairira on Tue, 2020-12-22 22:55

Alan,    To recap, in Jan. 2020 I took a TIRA distribution as my expected RMD.   On 6/25/20 I rolled back part of that to my one TIRA.  I made no other rollbacks in 2019 or 2020.      Almost a week ago I took a TIRA distribution.  I plan to use my one rollover/year to roll that back to my TIRA and would like to ask if I am limited to just the amount of the Dec. distribution or if I may roll back a little more but an amount that added to my 6/25/20 rollback would still total less than the amount of my Jan. 2020 “RMD.”     Thank you for your help to me and so many others ad my best holiday wishes.

Submitted by fairira on Tue, 2020-12-22 23:25

Alan,Except for my thanks and holiday wishes, please disregard my above inquiry that was somehow transmitted in error beause of course I can’t roll back more than the Dec. 2020 distribution since much more than 60 days have passed since Jan. 2020.

Submitted by Alan - IRA critic on Tue, 2020-12-22 23:46

You can roll back the December distribution or any part of it, but you cannot roll back any additional amount. The deadline for rolling back the balance of your January distribution was 8/31/2020. Of course, by rolling any amount of the Dec distribution over, you cannot do another 60 day rollover for the next 12 months after the date of the Dec distribution.  Best holiday wishes to you also.

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