The CARES Act passed by Congress in March provided stimulus money to millions of Americans, and it also gave retirees a reprieve from having to take mandatory annual withdrawals from their retirement savings, including 401(k) plans and individual retirement accounts.
- If you're over 70.5, you are not required to take an annual required minimum distribution (RMD) in 2020.
- You generally have to start taking withdrawals from your IRA, SIMPLE IRA, SEP IRA, or retirement plan account when you reach age 70½. Due to changes made by the SECURE Act, if your 70th birthday is July 1, 2019 or later, you do not have to take withdrawals until you reach age 72.
The CARES Act also allowed savers to take emergency withdrawals — known as hardship distributions — of up to $100,000 from their retirement plans. Individuals who are under age 59½ can withdraw their 401(k) and 403(b) funds without the usual 10% early withdrawal penalty.
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