On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act of 2020 (the CARES Act) was signed into law. The law is one of the largest stimulus packages in our nation’s history and includes multiple provisions that affect the Solo 401k.
One goal of the CARES Act is to give those affected by the current pandemic access to your retirement funds while minimizing tax consequences and maximizing the ability to return your funds to the Solo 401k where allowed.
Q1. Can the Solo 401k waive the 2020 RMD requirements?
Q2. What RMDs are waived?
A2. Any RMDs required in the 2020 calendar year. This includes first year RMDs that have a required beginning date in 2020.
Q3. What if I’m turning 72 in 2020?
A3. 2020 is disregarded in determining the required beginning date. If you turn 72 in 2020, your RMD schedule will be treated as if you turned 72 in 2021.
Q4. If I’ve already taken their RMD, can I roll it back into the Solo 401k?
A4. Yes, if you already took out the funds you have 60 days to put money back; or you can treat the distribution as part of the $100,000 maximum Coronavirus-related distribution.