The IRS has issued a clarification on the notifications about required minimum distributions (RMDs) that must be provided to IRA owners who will turn 70½ in 2020 in light of the provisions of the SECURE Act.
Under the SECURE Act, the new required beginning date for an RMD for an IRA owner is April 1 of the calendar year following the year in which the individual attains age 72, not age 70½. Thus, notifications concerning RMDs for those who will turn 70½ in 2020 are no longer due on Jan. 31, 2020.
The IRS says that it recognizes that financial institutions have had only a short time since enactment of the SECURE Act on Dec. 20, 2019 to change their systems for furnishing the RMD statement. In Notice 2020-6, the IRS says that if an RMD statement is, or already has been, provided for 2020 to an IRA owner who will reach age 70½ in 2020, the IRS will not consider that statement to be incorrect –as long as the financial institution notifies the IRA owner no later than April 15, 2020, that no RMD is due for 2020.
Notice 2020-6 notes that the SECURE Act did not change the required beginning date for IRA owners who reached age 70½ before Jan. 1, 2020. It also encourages –but does not require – financial institutions to remind IRA owners who reached 70½ in 2019 and have not yet taken their 2019 RMDs that they still must take those distributions by April 1, 2020.
