IRS: New law provides relief for eligible taxpayers who need funds from IRAs and other retirement plans
An official website of the United States Government
IR-2020-172, July 29, 2020
WASHINGTON — The Internal Revenue Service provided a reminder today that the Coronavirus Aid, Relief, and Economic Security (CARES) Act can help eligible taxpayers in need by providing favorable tax treatment for withdrawals from retirement plans and IRAs and allowing certain retirement plans to offer expanded loan options.
Under the CARES Act, individuals eligible for coronavirus-related relief may be able to withdraw up to $100,000 from IRAs or workplace retirement plans before December 31, 2020, if their plans allow. In addition to IRAs, this relief applies to 401(k) plans, 403(b) plans, profit-sharing plans and others.
Individuals eligible to take coronavirus-related withdrawals may also, until September 22, 2020, be able to borrow as much as $100,000 (up from $50,000) from a workplace retirement plan, if their plan allows. Loans are not available from an IRA.
For eligible individuals, plan administrators can suspend, for up to one year, plan loan repayments due on or after March 27, 2020, and before January 1, 2021. A suspended loan is subject to interest during the suspension period, and the term of the loan may be extended to account for the suspension period.
Taxpayers should check with their plan administrator to see if their plan offers these expanded loan options and for more details about these options.
Retirement plan recipients can learn more about these provisions in IRS Notice 2020-50 (PDF).
The IRS has also posted FAQs that provide additional information regarding this relief.
Additional information on the CARES Act and retirement plans, as well as updates, other FAQs, and other information can be found at IRS.gov/coronavirus.
An official website of the United States Government
IR-2020-172, July 29, 2020
WASHINGTON — The Internal Revenue Service provided a reminder today that the Coronavirus Aid, Relief, and Economic Security (CARES) Act can help eligible taxpayers in need by providing favorable tax treatment for withdrawals from retirement plans and IRAs and allowing certain retirement plans to offer expanded loan options.
Under the CARES Act, individuals eligible for coronavirus-related relief may be able to withdraw up to $100,000 from IRAs or workplace retirement plans before December 31, 2020, if their plans allow. In addition to IRAs, this relief applies to 401(k) plans, 403(b) plans, profit-sharing plans and others.
Individuals eligible to take coronavirus-related withdrawals may also, until September 22, 2020, be able to borrow as much as $100,000 (up from $50,000) from a workplace retirement plan, if their plan allows. Loans are not available from an IRA.
For eligible individuals, plan administrators can suspend, for up to one year, plan loan repayments due on or after March 27, 2020, and before January 1, 2021. A suspended loan is subject to interest during the suspension period, and the term of the loan may be extended to account for the suspension period.
Taxpayers should check with their plan administrator to see if their plan offers these expanded loan options and for more details about these options.
Retirement plan recipients can learn more about these provisions in IRS Notice 2020-50 (PDF).
The IRS has also posted FAQs that provide additional information regarding this relief.
Additional information on the CARES Act and retirement plans, as well as updates, other FAQs, and other information can be found at IRS.gov/coronavirus.
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