IRA RMD Waiver for 2020

[Gordon G]

Does the March 2020 COVID-19 Stimulus Act waive 2020 RMDs for traditional IRAs?

[macuser_22]

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@Gordon G wrote:

Does the March 2020 COVID-19 Stimulus Act waive 2020 RMDs for traditional IRAs?

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Yes it does - the CARES act §2203 suspends ALL RMDS for 2020.

https://www.congress.gov/bill/116th-congress/house-bill/748/text

[Gordon G]

Thanks. But I had previously read HR 748 Sec. 2203, also Internal Revenue Code Sec. 401(a)(9) which it amends but could find no explicit statement regarding RMDs. HR 748 Sec, 2203(a)(i)(III) appears to modify 401(a)(9) but the latter doesn't specify RMDs. I would appreciate a citation in the Internal Revenue Code that explicitly specifies RMDs and an explanation of how HR 748 applies the waiver. 

[macuser_22]

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@Gordon G wrote:

Thanks. But I had previously read HR 748 Sec. 2203, also Internal Revenue Code Sec. 401(a)(9) which it amends but could find no explicit statement regarding RMDs. HR 748 Sec, 2203(a)(i)(III) appears to modify 401(a)(9) but the latter doesn't specify RMDs. I would appreciate a citation in the Internal Revenue Code that explicitly specifies RMDs and an explanation of how HR 748 applies the waiver. 

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§401(a)(9) Defines Required distributions.  When reading §401(a)(9) you must include the following language since the §2203 added that text to §401(a)(9).

The language is rather clear as is the title of the provision.

SEC. 2203. Temporary waiver of required minimum distribution rules for certain retirement plans and accounts.

(a) In general.—Section 401(a)(9) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:

“(I) TEMPORARY WAIVER OF MINIMUM REQUIRED DISTRIBUTION.—

“(i) IN GENERAL.—The requirements of this paragraph shall not apply for calendar year 2020 to—

“(I) a defined contribution plan which is described in this subsection or in section 403(a) or 403(b),

“(II) a defined contribution plan which is an eligible deferred compensation plan described in section 457(b) but only if such plan is maintained by an employer described in section 457(e)(1)(A), or

“(III) an individual retirement plan.

“(ii) SPECIAL RULE FOR REQUIRED BEGINNING DATES IN 2020.—Clause (i) shall apply to any distribution which is required to be made in calendar year 2020 by reason of—

“(I) a required beginning date occurring in such calendar year, and

“(II) such distribution not having been made before January 1, 2020.

“(iii) SPECIAL RULES REGARDING WAIVER PERIOD.—For purposes of this paragraph—

“(I) the required beginning date with respect to any individual shall be determined without regard to this subparagraph for purposes of applying this paragraph for calendar years after 2020, and

“(II) if clause (ii) of subparagraph (B) applies, the 5-year period described in such clause shall be determined without regard to calendar year 2020.”.

[NCperson]

well, since we are all somewhat bored, i read IRS 401(a)(9) and it certainly does cover RMD

the title of section 401(a)(9) is 'required distributions'

since there is a requirement that implies there is a minimum

section 2203 discussed the TEMPORARY waiver of RMD for 2020. (look at the title of this section 2203aI)

what is you real concern?  

the RMD requirement for 2020 is zero (same thing occurred in 2009).  Any distribution will meet this temporary RMD requirement.

[Gordon G]

NCperson: Thanks. I was looking for the original specification of RMDs to which the waiver applies. At first I could not find RMDs explicitly specified in 401(a)(9). Re-reading it, RMDs appear to specified in 401(a)(9)(A)(ii). It seems a rather obtuse specification but I guess that's government legalese.

[macuser_22]

That is why the IRS has dozens of publications to describe the tax law in language that the average (non-lawyer) can understand.