Designed as a relief package for Americans during the COVID-19 pandemic, the CARES Act includes changes that allow more flexibility with Individual Retirement Accounts (IRAs) and Health Savings Accounts (HSAs). (For changes to IRA requirements as part the 2019 SECURE Act, visit our New Year Jumpstart Guide.)
Am I required to do anything different with my IRA or HSA in 2020?
No. Taking advantage of the changes is completely optional.
What is the 2020 deadline to make 2019 IRA and HSA contributions?
You have until July 15, 2020, to make contributions for 2019.
Am I required to take a required distribution in 2020 from my IRA?
You are not required to make a distribution in 2020. If you do take a distribution and change your mind, you have 60 days from the distribution date to pay it back.
What if I need to withdraw money from my IRA to cover COVID-19-related hardship?
You are eligible for penalty-free hardship distributions, regardless of age, if you meet any of the following conditions:
- You are diagnosed with COVID-19.
- You have a spouse or dependents diagnosed with COVID-19.
- You experience financial disruption due to quarantine, furlough, layoff, or reduced work hours, or if you’re unable to work because you need to provide childcare.
- You are a business owner who had to reduce business hours or close due to COVID-19.
- You experience any other circumstance deemed eligible by the Secretary of the Treasury.
Qualifying early withdrawals due to COVID-19 can be repaid over tax years 2020, 2021, and 2022. The IRS will publish additional repayment guidance at a future date.