IRS Allows Rollovers for 2020 RMDs through August 31

June 23, 2020 | Kristine A. Tidgren

On June 23, 2020, IRS issued Notice 2020-51, providing guidance for the waiver of 2020 required minimum distributions (RMD) made possible by the CARES Act. The guidance also provides sample plan amendments.

The CARES Act allowed any taxpayer with an RMD due in 2020 to waive the RMD this year.[i] This includes those who turned 70 1/2 in 2019 and would have had to take their first RMD by April 1, 2020. After the provision was enacted, some taxpayers who had already taken an RMD for 2020 had no option to take advantage of the CARES Act relief. A typical rollover is 60 days. This guidance changes that.

Expanded Rollover Opportunities

  • The guidance provides that anyone who took a 2020 RMD-distribution from a defined-contribution plan impacted by the CARES Act waiver is eligible to roll those funds over into a retirement account by August 31, 2020, to avoid paying tax on the distribution. The guidance provides this example:

If a participant received a single-sum distribution in January 2020, part of which was treated as ineligible for rollover because it was considered an RMD, that participant will have until August 31, 2020, to roll over that part of the distribution.

  • Likewise, an IRA owner or beneficiary who received a distribution from an IRA that would have equaled a 2020 RMD can repay the distribution to the IRA by Aug. 31, 2020. This repayment is not subject to the one rollover per 12-month period limitation or the restriction on rollovers for inherited IRAs.

Other Guidance

In addition to these rules, the guidance answers questions relating to the waiver of 2020 RMDs and provides a sample plan amendment that, if adopted, would provide participants a choice whether to receive waived RMDs. It also provides transition guidance to plan administrators regarding the SECURE Act provision altering the beginning age for RMD distributions from 70 ½ to 72.


[i] This applies to RMDs from a defined-contribution retirement plan, including a 401(k) or 403(b) plan. It does not include defined-benefit plans.