Need Postponement of RMD (Required Minimum Distribution) Withdrawal from Retire. Acc.
 

Anyone that is over 70&1/2 that has a retirement account must make IRS required withdrawals every year, called RMD (Required Minimum Distribution) on which taxes are paid the following year. With the bloodbath these accounts have taken by the markets plummeting due to the virus (20%+?), and the senate working on a 3rd stimulus package, we need to call Senators Rubio and Scott's offices ASAP to have any such RMDs for this year postponed. Having to make these withdrawals from depleted accounts that a lot (most?) of us count on for daily living is a "double whammy" none of us can afford. This probably affects the majority of Villagers, I imagine. The senate switchboard number is, 202-224-3121. Time is of the essence Villagers!

I agree. Fortunately I took my RMD in January before the market downturn.

The Secure Act that was passed by Congress and signed into law by President Trump in December 2019 changed the timing for RMDs. They now start at age 72.

What Is the SECURE Act and How Could It Affect Your Retirement?

Yes, worthwhile to ask fo a delay, and have a better understanding of how to calculate the amount considering the big decline in recent weeks.

But if there is a change in the RMD rules for 2020, you might have withdrawn an amount in 2020 that you did not have to. That is the point. The recent bloodbath in all such accounts is the reason that a postponement of one year in having to make any such withdrawals should be undertaken by the IRS!

The SECURE Act does not apply to those of us that reached 70&1/2 BEFORE July 1, 2019!!!

You may recall that It was done in 2009, during the Great Recession, so there is precedent.

Not going to happen. The Federal government needs some money to come into its coffers to try to offset the large outlay that is about to happen as well as the massive spending done by Trump during his first three years.

Don't be so sure that it will not happen. Key Members of the Senate Finance and Ways and Means Committees are in discussions to do it, with the backing of financial houses like Morgan Stanley and organizations like the AARP and inclination by Congress to also do it. The senior population is also a MAJOR voting block, particularly in states like Florida. It will not look at all politically savvy to stiff seniors by forcing them to withdraw an RMD amount for 2020 out of a disastrously depleted retirement caused by the virus and the lack of a real timely federal government response when other segments of the population are going to be helped by the next stimulus package. Stiffing the older generation will not be in the cards by Trump and his backers.

You are so right about the precedent set in 2009!

If you do not need the RMD you can move stock from your retirement account to your taxable brokerage account. Thus you can retain your position in the stock until it recovers. You will also get capital gains treatment for the appreciation when the market recovers. Depending on your tax situation you may be eligible for a zero tax on your capital gains.

But whether you move your stocks from a retirement account into a brokerage account, the law requires you to pay taxes on the amount required of you to be withdrawn. So, your suggestion does not alleviate the fact that for 2020 you still need to withdraw an amount upon which then you have to pay the taxes by April 15, 2021. Again, the ONLY remedy given my initial posting is to have Congress remove the requirement of an RMD for this (2020) year!

A great idea and that would help a number of retirees.

Postponing the RMD this year would reduce your 2020 taxes. But, if you have a balanced portfolio of stocks, bonds, and cash, with 30 percent in stocks, then your total investments are only down about 10 percent so far this year, and we haven't even gone through the first quarter. So, I think it is too soon to pass a law that would postpone the RMD.

I don't see what the issue is. Make a withdrawal from your non-equity retirement funds, such as bonds. Surely you don't have all of your retirement account funds in equities?

Then call Senators Rubio and Scott ASAP!