The CARES Act (Coronavirus Aid, Relief, and Economic Security Act) suspends an annual required minimum distribution (RMD) for IRAs in 2020. This includes:
- RMDs for those who reached age 70½ on or before Dec. 31, 2019, and would be required to take their first RMD by April 1, 2020.
- It also includes RMDs from inherited IRAs for 2020.
- If you regularly contribute through your IRA, you can still elect to take RMD as a qualified charitable distribution.
The CARES Act includes a new above-the-line universal charitable deduction of $300 for all taxpayers. The goal is to encourage increased giving during a time of great need. The legislation also increases the annual limit on cash gifts for individuals who itemize, from 60% to 100% of adjusted gross income for 2020. The revised universal charitable deduction and cash contribution/AGI provisions do not apply to supporting organizations or donor advised funds. We suggest consulting with your financial advisor if you have questions.
