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Coronavirus and Retirement Plans – Updates from IRS Notices

We have previously posted discussions regarding the impact of the SECURE Act on planning for retirement plan distributions. With the COVID-19 pandemic, the Coronavirus Aid, Relief and Economic Security Act (CARES Act) was enacted, including several provisions addressing distributions from retirement plans and special tax treatment. The IRS recently issued two notices, Notice 2020-50 and Notice 2020-51, which are intended to provide guidance for coronavirus-related distributions.

IRS NOTICE 2020-50 – This notice provides guidance regarding provisions of the CARES Act permitting qualified individuals to take penalty-free distributions from eligible retirement plans.

To continue reading this notice, click here.

IRS NOTICE 2020-51 – This notice provides guidance regarding provisions of the CARES Act suspending required minimum distributions (RMDs) for the 2020 calendar year. Q&A-12 of this notice makes it clear that the suspension of RMDs only applies to a defined contribution plan (e.g., 401(k)) or an IRA; it is not available for a defined benefit plan.

To continue reading this notice, click here.

If you have any questions regarding the CARES Act and these recent IRS notices, please feel free to contact us.

 

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