Menu
Tax Notes logo

Lift Required Minimum Distribution Rules, Senators Say

MAR. 19, 2020

Lift Required Minimum Distribution Rules, Senators Say

DATED MAR. 19, 2020
DOCUMENT ATTRIBUTES

March 19, 2020

The Honorable Steven T. Mnuchin
Secretary
Department of the Treasury
1500 Pennsylvania Avenue, NW
Washington, D.C. 20220

Dear Secretary Mnuchin.

Over the last several months, the outbreak of Coronavirus (COVID-19) has caused substantial disruption to global financial markets. Under current law, IRA, 401(k), and 403(b) owners are forced to make required minimum distributions from their accounts the later of the year after they retire or the year after they turn 72 (70½ if you reach 70½ before January 1, 2020).

To avoid forcing retirees to make withdrawals in the midst of serious economic turmoil, we respectfully request that you use the flexibility provided by statute to immediately waive the required minimum distribution for IRAs, 401(k)s, and 403(b)s for the 2020 tax year. Furthermore, we ask that you use the same authority to allow retirees who have already withdrawn in 2020 to make recontributions to their accounts. This action would allow retirees to protect some of their savings during these uncertain times.

While the Internal Revenue Code requires retired individuals to begin taking withdrawals the later of the year after they retire or the year after they turn 72 (70½ if you reach 70½ before January 1,2020), it is our understanding that, under Section 7508A of the Internal Revenue Code, Treasury regulations set the specific intervals and penalties, and therefore the distribution requirements could be adjusted for 2020 without Congressional action.

This action is not without precedent: in December 2008, the Bush Administration signed H.R. 7327, the Worker, Retiree, and Employer Recovery Act, into law. Among other things, the act suspended for 2009 the requirement that individuals 70½ and older must withdraw a minimum amount from their IRAs, 401(k)s. and 403(b)s.

We thank you in advance for your prompt consideration of this request.

Respectfully,

U.S. Senator Steve Daines

U.S. Senator Rob Portman

U.S. Senator Edward J. Markey

U.S. Senator Mark Warner

DOCUMENT ATTRIBUTES
Copy RID