How does the CARES Act impact required minimum distributions (RMDs)?

In March 2020, Congress passed the Coronavirus Aid, Relief and Economic Security (CARES) Act to support individuals and businesses impacted by coronavirus. It provides financial help through targeted tax relief, early access to retirement savings, as well as loan and grant programs for small businesses.

As part of the CARES Act, required minimum distributions (RMDs) are waived for 2020. Typically, the IRS requires you take RMDs from Traditional and SEP IRAs starting at age 72 each year (or age 70½ if you turned 70½ before December 31, 2019). This year, you have the option to not take an RMD.

Keep in mind that RMD rules can be complicated. Please consult a financial advisor if you have any questions about how this waiver might affect you.