Earlier this week, the Internal Revenue Service (“IRS”) announced that employee benefit plan participants that already took a required minimum distribution (RMD) in 2020 from certain retirement accounts now has the opportunity through August 31, 2020 to roll those funds back into a retirement account following the Coronavirus Aid, Relief, and Economic Security (CARES) Act RMD waiver for 2020. The announcement of this relief covers one of a long and growing list of special tax and other COVID-19 responsive special rules and requirements that may change requirements, provide special relief or both for businesses and individuals that every business leader and individual should carefully monitor and respond to appropriately.
Retirement Plan Rollover Relief
On July 23, 2020, the IRS announced its extension of the 60-day rollover period for any RMDs already taken this year to August 31, 2020 to give taxpayers time to take advantage of this opportunity in Notice 2020-51 (PDF). The Notice also answers questions regarding the waiver of RMDs for 2020 under the Coronavirus Aid, Relief, and Economic Security Act, known as the CARES Act.
The CARES Act enabled any taxpayer with an RMD due in 2020 from a defined-contribution retirement plan, including a 401(k) or 403(b) plan, or an IRA, to skip those RMDs this year. This includes anyone who turned age 70 1/2 in 2019 and would have had to take the first RMD by April 1, 2020. This waiver does not apply to defined-benefit plans.
In addition to the rollover opportunity, an IRA owner or beneficiary who has already received a distribution from an IRA of an amount that would have been an RMD in 2020 can repay the distribution to the IRA by August 31, 2020. The notice provides that this repayment is not subject to the one rollover per 12-month period limitation and the restriction on rollovers for inherited IRAs.
The notice provides two sample amendments that employers may adopt to give plan participants and beneficiaries whose RMDs are waived a choice as to whether or not to receive the waived RMD.
Other COVID-19 Tax Rules & Relief
The guidance and relief in Notice 2020-51 highlights only one of a long list of special COVID-19 associated tax rules and relief that could apply to a business, its employees or employee benefit plan participants or both including the following:
- IR-2020-127, IRS announces rollover relief for required minimum distributions from retirement accounts that were waived under the CARES Act
- IR-2020-126, IRS extends July 15, other upcoming deadlines for tornado victims in parts of the South; provides other relief
- IR-2020-124, Relief for taxpayers affected by COVID-19 who take distributions or loans from retirement plans
- IR-2020-122, IRS outlines changes to health care spending available under CARES Act
- IR-2020-121, IRS alert: Economic Impact Payments belong to recipient, not nursing homes or care facilities
- IR-2020-120, Treasury, IRS provide tax relief to investors and businesses affected by COVID-19 in new markets tax credit transactions
- IR-2020-119, IRS provides guidance on employer leave-based donation programs that aid victims of the COVID-19 pandemic
- IR-2020-118, IRS reminder: File now, choose direct deposit or schedule tax payments electronically before the July 15 deadline
- IR-2020-117, IRS reminder: Deadline postponed to July 15 for those who pay estimated taxes
- IR-2020-115, IRS warns against COVID-19 fraud; other financial schemes
- IR-2020-114, IRS provides answers about Coronavirus related tax relief for Qualified Opportunity Funds and investors
- IR-2020-111, 159 million Economic Impact Payments processed; Low-income people and others who aren’t required to file tax returns can quickly register for payment with IRS Non-Filers tool
- IR-2020-110, IRS provides relief to retirement plan participants to sign elections remotely
- IR-2020-109, IRS reminder: June 15 tax deadline postponed to July 15 for taxpayers who live and work abroad
- IR-2020-106, Treasury, IRS provide safe harbor for taxpayers that develop renewable energy projects
- IR-2020-105, Economic Impact Payments being sent by prepaid debit cards, arrive in plain envelope; IRS.gov answers frequently asked questions
- IR-2020-101, Treasury, IRS release latest state-by-state Economic Impact Payment figures for May 22, 2020
- IR-2020-99, IRS.gov helps taxpayers get tax information they need; find tools for filing, paying, checking accounts and answering questions
- Treasury News Release: Treasury is Delivering Millions of Economic Impact Payments by Prepaid Debit Card
- IR-2020-97, IRS adds phone operators to answer Economic Impact Payment questions
- IR-2020-96, IRS expands partner materials for Economic Impact Payments; continues sweeping effort to share details in multiple languages
- IR-2020-95, IRS provides tax relief through increased flexibility for taxpayers in section 125 cafeteria plans
- IR-2020-93, Why the Economic Impact Payment amount could be different than anticipated
- IR-2020-92, Act by Wednesday for chance to get quicker Economic Impact Payment; timeline for payments continues to accelerate
- IR-2020-91, Treasury, IRS release latest state-by-state Economic Impact Payment figures
- IR-2020-89, IRS: Three new credits are available to many businesses hit by COVID-19
- IR-2020-87, IRS retools Settlement Days program in response to COVID-19 pandemic; allows unrepresented taxpayers to settle their cases virtually and reach finality
- IR-2020-86, VA, SSI recipients with eligible children need to act by Tuesday, May 5 to quickly add money to their automatic Economic Impact Payment; ‘Plus $500 Push’ continues
- IR-2020-85, Economic Impact Payments continue to be sent, check IRS.gov for answers to common questions
- IR-2020-83, Use IRS Non-Filers: Enter Payment Info Here tool to get Economic Impact Payment; many low-income, homeless qualify
- IR-2020-82, IRS enhances Get My Payment online application to help taxpayers
- IR-2020-81, VA, SSI recipients with eligible children need to act by May 5 to quickly add money to their automatic Economic Impact Payment; ‘Plus $500 Push’ continues
- IR-2020-80, Treasury, IRS deliver 89.5 million Economic Impact Payments in first three weeks, release state-by-state Economic Impact Payment figures (Updated: April 28, 2020)
- IR-2020-77, Treasury, IRS announce cross-border tax guidance related to travel disruptions arising from the COVID-19 emergency
- IR-2020-76, SSA, RRB recipients with eligible children need to act by Wednesday to quickly add money to their automatic Economic Impact Payment; IRS asks for help in the “Plus $500 Push”
- IR-2020-75, Veterans Affairs recipients will receive automatic Economic Impact Payments; Step follows work between Treasury, IRS, VA
- IR-2020-74, IRS: Free File use soars; taxpayers still have time to do their taxes for free
- IR-2020-73, Supplemental Security Income recipients will receive automatic Economic Impact Payments; step follows work between Treasury, IRS, Social Security Administration
- IR-2020-72, Treasury, IRS unveil online application to help with Economic Impact Payments
- IR-2020-71, IRS, Security Summit partners warn tax professionals on scams, urge additional security measures to protect taxpayer data
- IR-2020-70, REMINDER: Schedule and pay federal taxes electronically due by July 15; only a few hours remaining for taxpayers to reschedule payments set for April 15
- IR-2020-69, Treasury, IRS launch new tool to help non-filers register for Economic Impact Payments
- IR-2020-68, IRS urges taxpayers to use electronic options; outlines online assistance
- IR-2020-67, IRS provides guidance under the CARES Act to taxpayers with net operating losses
- IR-2020-66, To help taxpayers, the Department of Treasury and the Internal Revenue Service announced today that Notice 2020-23 extends additional key tax deadlines for individuals and businesses
- IR-2020-65, Follow IRS on social media, sign up for e-news subscriptions for urgent updates on COVID-19, scams and economic impact payment information
- IR-2020-64, IRS issues warning about coronavirus-related scams; watch out for schemes tied to economic impact payments
- Treasury News Release: Social Security recipients will automatically receive Economic Impact Payments
- IR 2020-62, IRS: Employee Retention Credit available for many businesses financially impacted by COVID-19
- IR 2020-61, Economic impact payments: What you need to know
- IR-2020-59, IRS unveils new People First Initiative; COVID-19 effort temporarily adjusts, suspends key compliance program
- IR-2020-58, Tax Day now July 15: Treasury, IRS extend filing deadline and federal tax payments regardless of amount
- IR-2020-57, Treasury, IRS and Labor announce plan to implement coronavirus-related paid leave for workers and tax credits for small and midsize businesses to swiftly recover the cost of providing Coronavirus-related leave
- Treasury News Release: Treasury and IRS issue guidance on deferring tax payments due to COVID-19 outbreak
- IR-2020-54, IRS: High-deductible health plans can cover coronavirus costs
Along with these tax rules, businesses and their employees also may be impacted by a broad range of special federal and state labor and employment and other rules adopted in response to the continuing COVID-19 health care emergency and its fallout. Businesses and their leaders should carefully review and monitor these and other COVID-19 specific rules to ensure that their businesses don’t trigger unanticipated liability by failing to meet critical requirements or to ensure that they take full advantage of all available relief.
We hope this update is helpful. For more information about the these or other health or other legal, management or public policy developments, please contact the author Cynthia Marcotte Stamer via e-mail or via telephone at (214) 452 -8297.
Solutions Law Press, Inc. invites you receive future updates by registering on our Solutions Law Press, Inc. Website and participating and contributing to the discussions in our Solutions Law Press, Inc. LinkedIn SLP Health Care Risk Management & Operations Group, HR & Benefits Update Compliance Group, and/or Coalition for Responsible Health Care Policy.
About the Author
Recognized by her peers as a Martindale-Hubble “AV-Preeminent” (Top 1%) and “Top Rated Lawyer” with special recognition LexisNexis® Martindale-Hubbell® as “LEGAL LEADER™ Texas Top Rated Lawyer” in Health Care Law and Labor and Employment Law; as among the “Best Lawyers In Dallas” for her work in the fields of “Labor & Employment,” “Tax: ERISA & Employee Benefits,” “Health Care” and “Business and Commercial Law” by D Magazine, Cynthia Marcotte Stamer is a practicing attorney board certified in labor and employment law by the Texas Board of Legal Specialization and management consultant, author, public policy advocate and lecturer widely known for 30+ years legal and operational management work, coaching, public policy and regulatory affairs leadership and advocacy, training and public speaking and publications. As a significant part of her work, Ms. Stamer has worked extensively domestically and internationally on an demand, special project and ongoing basis with health industry, health plan and insurance and other businesses of all types, government and community organizations and their leaders, spoken and published extensively on workforce and other services, compensation and benefits, and related tax; insurance; workers’ compensation and occupational disease; business reengineering, disaster and distress; and many other management concerns.
Board Certified in Labor and Employment Law By the Texas Board of Legal Specialization, Scribe for the ABA JCEB Annual Agency Meeting with OCR, Vice Chair of the ABA International Section Life Sciences Committee, and the ABA RPTE Employee Benefits & Other Compensation Group and a former Council Representative, Past Chair of the ABA Managed Care & Insurance Interest Group, former Vice President and Executive Director of the North Texas Health Care Compliance Professionals Association, past Board President of Richardson Development Center (now Warren Center) for Children Early Childhood Intervention Agency, past North Texas United Way Long Range Planning Committee Member, and past Board Member and Compliance Chair of the National Kidney Foundation of North Texas, and a Fellow in the American College of Employee Benefit Counsel, the American Bar Foundation and the Texas Bar Foundation, Ms. Stamer has extensive experience advising, representing, defending and training health care providers, health plans and insurers, employers, community organizations and others about HIPAA and other privacy concerns and has published and spoken extensively on these concerns.
Her involvement with HIPAA and other privacy and data concerns has taken place as part of her more than 30 years involvement working with with public and private health industry, health insurance and other employers and organizations of all sizes, employee benefit plans, insurance and financial services, health industry and a broad range of public and private domestic and international business, community and government organizations and leaders on pandemic and other health and safety, workforce and performance preparedness, risks and change management, disaster preparedness and response and other operational and tactical concerns throughout her adult life. A former lead advisor to the Government of Bolivia on its pension project, Ms. Stamer also has worked internationally and domestically as an advisor to business, community and government leaders on crisis preparedness and response, privacy and data security, workforce, health care and other policy and enforcement, as well as regularly advises and defends organizations about the design, administration and defense of their organizations workforce, employee benefit and compensation, safety, discipline and other management practices and actions.
Ms. Stamer also serves in leadership of a broad range of professional and civic organizations and shares insights and thought leadership through her extensive publications and public speaking. For more information about Ms. Stamer or her health industry and other experience and involvements, see www.cynthiastamer.com or contact Ms. Stamer via telephone at (214) 452-8297 or via e-mail here.
About Solutions Law Press, Inc.™
Solutions Law Press, Inc.™ provides human resources and employee benefit and other business risk management, legal compliance, management effectiveness and other coaching, tools and other resources, training and education on leadership, governance, human resources, employee benefits, data security and privacy, insurance, health care and other key compliance, risk management, internal controls and operational concerns. If you find this of interest, you also be interested reviewing some of our other Solutions Law Press, Inc.™ resources available here such as:
- Ezekiel Elliott COVID-19 Diagnosis Disclosure Outrage Highlights Need To Handle COVID-19 & Other Medical Information With Care
- Proposed Regulations Would Treat Direct Primary Care and Health Care Sharing Ministries Membership Dues As Qualifying Medical Expenses For Medical Deduction & HSA Reimbursement Purposes
- Wish Tax Guidance Were Clearer? Tell IRS/Treasury Your Suggested Topics For 2020-2021 Treasury Priority Guidance Plan
- New IRS Increased Health FSA Carryover, Gives COVID Health FSA Election Relief
- IRS Shares Initial CARES Act Plan Loan & Distribution Relief Guidance
- Employer Sponsors & Health Plans Face Rising Risk From Mental Health & Substance Abuse Coverage Violations
- Use Prudent Process To Manage Workforce & Other Business Changes To Help Minimize Business & Management Liabilities & Protect Future Recovery
- Congress Expected To Pass COVID-19 Relief Bill With Paid Leave Mandates & Expanded Unemployment Funding This Week
- New Resources For Businesses, Employers, Schools & Homes To Stay Safe From COVID-19
- Self Insured Plan & Contract Amendments Likely Required To Waive Deductibles, Expand Other Coronavirus Coverage
- Health Plans, Providers & PBM Face Pressure To Prepare For Health Transparency As Trump Transparency Reforms March Foward
- Proposed HHS Rule Making PBM Expenses Part of MLS Administrative Expense, Other Changes To ACA Health Plan Rules Comment Deadline 5 P.M. Today
- Employers Prepare For Employment Tax Withholding Changes; Review & Comment On Proposed Rule Changes
- Employers Prepare For Employment Tax Withholding Changes; Review & Comment On Proposed Rule Changes
- New PBGC Pension Rules Effective 3/5 May Require Action On Retirement Plans
- Revise Health Plan HIPAA Records Access Rules & Procedures To Use Newly Flexibility On Charging, Responding To Third Party PHI Requests
- 2/28 New Comment Deadline For NLRB Proposal To Exclude College Work Study Student Workers From NLRA Coverage
- Don’t Get Stuck Paying Another Employer’s Overtime Or Other Backpay
- 2019 OCR Enforcement Shows Getting Defensibly HIPAA Compliant Necessary In 2020!
- DOJ Omnicare/CVS Suit Highlights Potential Pharmacy Benefit Claims Abuse Exposure For Health Plans, Member Safety Risk
- OSHA Seeks Small Business Volunteers For Tree Care Safety Panel
- NLRB Restores Pre-Obama Era Union Dues Checkoff Rule
- $1.6M HIPAA Penalty Largely Caused By Inadequate Security Assessments & Oversight
- 10 Former NFL Payers Charged With Defrauding NFL Retiree Health Fund
- NLRB Order Directs Settlement Of McDonald’s Unfair Labor Practice Complaints Including Joint Employer Liability Charges Against McDonald’s USA
- 2018 US National Health Expenditures Grew Again
- ONC Patient Matching for Prescription Drug Monitoring Program Slides Available
- SBA Hosts Employee Benefits Roundtable 11/21
- College Pays $54,000 To Settle DOJ ADA Lawsuit For Paramedic Program’s Termination of TA With MS
- Business Leaders Serve Jail Time For Employment Tax Crimes
- New $2.15M OCR Penalty Shows Health Plans Risks Of HIPAA Violations
- Proposed NLRB Employee Definition To Exclude College Study Workers
- DOL Proposing To Allow Default Website ERISA Retirement Plan Disclosures
- Salary Threshold Increases Require Employer Review Of Salaried Worker FLSA Exemption Qualification
If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information including your preferred e-mail by creating your profile here. ©2020 Cynthia Marcotte Stamer. Non-exclusive right to republish granted to Solutions Law Press, Inc.￼