CARES ACT PROVISIONS RELATED TO RETIREMENT PLANS

• Affected retirement plans

i. IRA’s

ii. 401(a) Plans

iii 401(k) Plans

iii. 403(b) Plans

• An otherwise premature distribution of up to $100,000.00 can be made if:

i. The individual was diagnosed with COVID-19; or

ii. The individual’s spouse was diagnosed with COVID-19; and

iii. The individual has experience- adverse financial consequences due to COVID-19

• With respect to COVID-19 related distributions

i. 10% penalty tax on the early distribution is waived

ii. One can allocate the taxable portion of the distribution over a three-year period

iii. The distribution is not subject to the 20% mandatory federal withholding tax.

iv. The COVID-19 distribution can be repaid within 3 years from the date of receipt..

• One has 180 days beginning on March 27, 2020 to take a loan which is capped at $100,000 less the value of any other outstanding loans.

• Required Minimum Distributions (RMD’s) are waived for 2020, including those that must be taken before April 1, 2020 but only to the extent not distributed before January 1, 2020