Retirement Plans

The CARES Act waives the 10% penalty on early withdrawls up to $100,000 from qualified retirement plans for coronavirus related distributions. Any income attributable to an early withdrawl is subject to tax over a three-year period, and taxpayers may recontribute the withdrawn amounts to a qualified retirement plan without regard to annual caps on contributions if made within three years.

The Act also waives all required minimum distributions for 2020, regardless of whether the taxpayer has been impacted by the pandemic.