Required Minimum Distributions are Temporarily Suspended
When President Trump signed the Coronavirus Aid, Relief and Economic Security (CARES) Act on March 27, he enacted the largest aid package in American history. One important impact is that Required Minimum Distributions (RMDs) for 2020 are, in essence, suspended. In this way, the federal government chose to sacrifice short-term tax revenue in order to provide immediate financial relief to retirees.
This change bears discussion, however, as there are many questions about what the CARES Act means for those who have already taken their 2020 RMDs, as well as any impact on taxes and inherited accounts.
Let’s begin with a review of the basic tenets of the RMD portion of this new law.