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Member Education

2020 IRA Distributions

The Coronavirus Aid, Relief and Economic Security (CARES) Act is intended to help those who have suffered economic hardship as a result of COVID-19. What does this mean for your retirement savings?Money IRA

Through the CARES Act, individuals are not required to take required minimum distributions (RMDs) from their IRAs in 2020.* Even though you're no longer required to take a withdrawal from your IRA this year, you can still take a withdrawal if you wish -- especially if you need the funds to get through this time.

You can learn more about the CARES Act here.

To qualify for the IRA distribution exception, the purpose must be coronavirus-related.

  • The individual, the individual’s spouse or a dependent must have been diagnosed with COVID-19, or the individual must experience adverse financial consequences as a result of being quarantined, furloughed, laid off or having work hours reduced due to COVID-19.
  • Individuals who were unable to work due to lack of child care as a result of COVID-19.
  • An individual whose business was closed or had reduced operating hours as a result of COVID-19.

You don't have to withdraw money this year

The CARES Act allows you to hold onto your savings if you're usually required to take money out of your retirement plan. The IRS typically requires you to begin taking money out of your traditional IRA once you reach a certain age (either 70½ or 72, depending upon your birth date). This is called a minimum distribution. The CARES Act waives this requirement in 2020 for all IRA plan participants, owners and beneficiaries.

  • All Required Minimum Distributions (RMDs) are suspended for 2020 including those for inherited IRAs and Traditional IRAs of those over age 70½. 
  • 2020 RMD’s that have already been taken will be taxed as regular income. A provision in the act will allow the return of a distribution if the funds are returned within 60 days to an IRA or deposit the funds to another qualified retirement account without owing taxes. The funds can also be converted into a Roth IRA.
  • The tax return filing deadline for 2019 was extended to July 15, this also extends the deadline for making a 2019 contribution to an IRA to July 15, 2020.
  • The 10% penalty on withdrawals from IRA and 401k’s for individuals under the age of 59 1/2 is waived. The waiver applies to distributions taken between January 1, 2020 and December 31, 2020. Up to $100,000 of distributions can avoid the penalty. This is an aggregate figure. Income taxes on a coronavirus-related distribution can be paid over a three-year period. The individual also has up to three years to recontribute the amount to a plan or IRA.

If your IRA is set up with an automatic distribution and you want to continue, you don't need to take any action.

If you've already taken an IRA withdrawal, you might be able to put funds back as a rollover if you:

  • Are the IRA owner.
  • Have not rolled over another IRA withdrawal within the past 12 months.
  • Return the funds within 60 days of taking the withdrawal.

To suspend your Powerco Federal Credit Union IRA RMD for 2020, the request will need to be sent in writing by email, mail or fax. Please send a letter requesting the RMD to be suspended and include the following information:

  • IRA owner's name
  • Account Number
  • Month the RMD was set to start
  • Letter must be signed and dated

Questions? Please call us at (404) 506-3750 or 1-800-633-5217 to speak with one of our IRA specialists. 

If sending your RMD delay request letter by mail, mail to:
Powerco Federal Credit Union
241 Ralph McGill Boulevard, NE
Atlanta, GA 30308

If sending your RMD delay request by fax, fax to: 
(404) 506-3787

If sending your RMD delay request by email, please email it to us through our new secure Member Message Center.

*Consult with your tax advisor regarding these tax exceptions.


This credit union is federally insured by the National Credit Union Administration.

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