Due to the CARES Act, Congress has waived all 2020 required minimum distributions (RMDs).

What if you already took out your annual RMD before Congress changed the law?

The IRS just granted you a new relief to fix the issue, but you need to act before August 31, 2020.

2020 RMD Waiver

The CARES Act waived all 2020 RMDs for IRAs and defined contribution plans. This waiver applies to your RMD if you:

1.)  Turned age 70.5 during tax year 2019 and had to take your first RMD by April 1, 2020, and waited until 2020 to take it;

2.)  Turn age 72 during tax year 2020 and have to take your first RMD by April 1, 2021; or

3.)  Inherited an IRA or retirement account and have to take an RMD for tax year 2020.


Let’s say you did not know about the waiver and you took your RMD. You want to put it back and avoid paying taxes on it. You have two ways to undo your 2020 RMD:

1.)  Do an indirect rollover to another account, or

2.)  Repay the funds to the same account.

Indirect rollover. You generally have 60 days from the distribution date to complete an indirect rollover. But in Notice 2020-51, the IRS extends this indirect rollover deadline so that you have until August 31, 2020, for RMD distributions you took earlier in tax year 2020.

As a reminder, you can’t do an indirect rollover from an inherited non-spousal IRA. Instead, to avoid being taxed on your RMD, you have to use the repayment method.

Repayment. You can repay the RMD to the original account by August 31, 2020, and pay no tax on it. And when you make this repayment under Notice 2020-51, it doesn’t count as the “one” indirect rollover per year that you can use.

Important note. These rules apply only to RMD amounts distributed (taken out of the IRA). Any amounts you took out exceeding your RMD amount aren’t eligible for relief.