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How the CARES Act & Secure Act Impact Your RMDs

The SECURE ACT and CARES ACT both changed RMDs for 2020. But how does this affect RMDs in 2021?

What is a Required Minimum Distribution (RMD)?

An RMD (a rule determined by the IRA) is an amount of money that is required to be taken from a retirement plan by a specific age.

The SECURE ACT in 2020

In 2019, the SECURE ACT was passed to help encourage retirement plan sponsors and employees to save for retirement. This ACT increased the RMD age from 70½ to 72.

The CARES ACT in 2020

In 2020, the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act) waived RMDs for the year. This waiver applied to all plan participants, not just those who were affected by the Coronavirus. 

If the participant turned 70 ½ prior to 2019, they did not need to take an RMD for 2020. 

RMDs in 2021

Those who are 72 or older in 2021 must take RMDs with the year’s payment due by December 31, 2021 (or they could face a penalty of 50% of the amount that should have been withdrawn). Participants who turn 72 in 2021 will be allowed a one-time extension to take their 2021 RMD no later than April 1, 2022.



Questions? Visit our FAQs Page to learn more about RMDs or contact our friendly service team.