Navigating The Required Minimum Distribution Rules For 2020 And Thereafter

August 2020 Addendum

In our May 2020 Benefits Brief, we stated a person born after July 1, 1949 would be subject to the required minimum distribution rules as revised by the SECURE Act. That interpretation was based on the wording of the Act that the new rules apply to individuals who attain 70 ½ after December 31, 2019. Since the publication of our May 2020 Benefits Brief, the Internal Revenue Service has interpreted the statute to mean a person born on July 1, 1949 would not be considered to be 70 ½ on December 31, 2019 and therefore anyone born after June 30, 1949 would be subject to the new rules.

Two recent tax changes, one added as part of the SECURE Act passed in late 2019 and another included in the recently enacted CARES Act, will affect required minimum distributions ("RMDs") in tax-qualified retirement and Section 403(b) plans of for-profit and tax-exempt employers in 2020 and thereafter. In this Benefits Brief, we will provide a general overview of