CARES Act and RMDs | Ed Slott and Company, LLC

CARES Act and RMDs

I hope you’ll provide information very soon about that the new virus legislation means for RMDs. When they are “suspended” for 2020 does that mean completely skipped for this year? Or does it mean they double up in 2021? If suspended and not distributed to a qualified charity, that counts as 2020 income to me? Or do 2020 RMDs not count as income at all?

Thanks. cmb

  • The statutory requirement to receive a distribution in 2020 is waived, not just postponed.  No RMD for 2020 will ever be required.
  • The tax treatment of a distribution is unchanged, except that if the distribution qualifies as a coronavirus-related distribution the income can be included over a 3-year period instead of being required to be entirely included in the year of the distribution.  Also, because any distribution in 2020 is no longer an RMD, the distribution is eligible for rollover if the rollover deadline is met.

Does the RMD Waiver apply to beneficiary accounts?


Is there anything to prevent someone, who would otherwise be subject to the RMD, from doing a Roth conversion instead?  I have a client who has significant medical expesnes this year and we don't want lose out on the tax planning opportunity, but instead of just taking the withdrawal (which is what we planned to do with the RMD), I'm thinking a Roth Conversion would be a better idea.

Yes, 2020 might be a good year to convert, since there is no RMD to add to income. In addition, the ability to itemize might reduce taxable income to a lower bracket. However, the conversion will add to AGI used to determine the % floor for itemizing medical. There is no restriction on doing such conversions, although it does not appear that a corona virus related distribution can be converted without being first rolled back to a TIRA account. In other words, it is not possible to pay the tax on a conversion over 3 years as can be done with a corona virus distribution.


Find members of Ed Slott's Elite IRA Advisor GroupSM in your area.
We neither keep nor share your information entered on this form.

I agree to the terms and services:

You may review the terms and conditions here.