IRA Reporting Relief for 2020 MRDs
IRA providers were concerned with not being able to “stop the presses” when it came to notices being provided in January to IRA owners regarding the need to take 2020 minimum required distributions (“MRDs”).
The law requires IRA providers to (1) report on Form 5498 if MRDs are required for the following year, and (2) provide a notice, generally by January 31 of each year, for those that must take a MRD for that year (e.g., under prior law, IRA owner that turn 70-1/2 in such year).
The IRS just issued Notice 2020-6, which provides guidance on how IRA providers may comply with these rules, and provides some relief to address non-compliance based on the late hour of the law change.
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