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2020 Cares Act (COVID-19) Solo 401k and IRA Distribution Deadline

11/6/2020

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QUESTION:

My question is regarding taking money out of my solo 401k or IRA.
I now need money to live on having been laid off. Do I have until end of December 2020 to take money out ??  I wasn’t thinking of taking a loan as don’t think I will be able to pay this back but you never know I assume I have three years to decide on paying it back or paying the taxes on the money?



ANSWER:

If you qualify to take a CARES ACT Distribution from your solo 401k plan or IRA in 2020, the deadline to take it is 12/31/2020.
You have three years and a day to re-contribute the amount of the CARES Act distribution in order to avoid the taxes (in which case you could file an amended return to claim a refund for taxes paid prior to the re-contribution).

See More HERE,  at the following: https://www.irs.gov/newsroom/coronavirus-relief-for-retirement-plans-and-iras#:~:text=The%20CARES%20Act%20waives%20required,your%20first%20RMD%20in%202020.


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    Author


    George Blower is a principal of My Solo 401k Financial LLC and also serves as the General Counsel with responsibility for providing all legal services to the organization.  

    Prior to joining My Solo 401k Financial, he served as general counsel for a subsidiary of a Fortune 500 financial services company.  

    He received his bachelor’s degree in economics at the University of Michigan in 1998 with honors. He received his juris doctorate from Harvard Law School in 2001. He is a member of the Michigan and Ohio bar associations.

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