As part of the new CARES Act, required minimum distributions (RMDs) are suspended for this year (2020) from retirement accounts, such as IRAs, 401(k)s, 403(b), 457(b), Roth 401(k), SIMPLE IRA, SEP IRAs, and inherited IRA accounts. This relief may help those obligated to take RMDs reduce their tax burden somewhat. This is especially true, since an RMD is based on the prior year’s ending balance (2019) when the markets were at all-time highs. Without this relief people would now be taking RMDs from greatly reduced balances due to the recent market drop. IMPORTANT: These rules are very new, and the IRS may not yet provide a clear position or guidance on these activities. As such, our members should consult with appropriate tax and legal counsel depending on their individual situation. Contact USAA (see phone numbers below) or your accounts’ custodians to inactivate the automatic withdrawals of your RMD for this year.


The following are a few additional questions our members might have about this new ruling:


Should I suspend my RMDs this year? It depends on your situation. If you need the funds from RMDs for your required living expenses, and do not have additional non-debt related resources available, then you may not be a candidate for suspending your required distributions.


What if I have already received part, or all, of my RMD for 2020; can I roll this back into the account to avoid taxation of the RMD this year? Yes. Normally an RMD cannot be rolled over. However, since the CARES Act waives RMDs for 2020, technically an RMD already taken is not an RMD anymore. This means that RMDs should be eligible to be rolled back into the IRA, thereby eliminating the tax bill. The new rules allow individuals to deposit an eligible rollover (based on IRS rules) back into the retirement account as long as the deposit occurs within 60 days of the original distribution dates.  In the recent IRS Notice 2023-20 the Internal Revenue Service extended the 60-day rollover rule for retirement accounts until July 15, but only for distributions taken between Feb. 1 and May 15, 2020. Note that the tax withheld in the original distribution cannot be reversed, but depending on other factors in your tax situation, the IRS could refund the tax withholding when your 2020 return is filed.


What if I haven’t taken my 2019 RMDs yet; can I still suspend distributions? Yes. Some people who turned 70-1/2 in 2019 may have elected to delay their first RMD due for 2019 until the April 1, 2020 date.  Now, under the CARES Act, that first time RMD is waived under these circumstances.


I am the beneficiary of an IRA; is my RMD waived for 2020? Yes. A beneficiary is not required to receive an RMD for 2020. 


I am the non-spouse beneficiary of an IRA; if I have already received part, or all, of my RMD for 2020; can I roll this back into the account to avoid taxation of the RMD this year No. A non-spouse beneficiary is not permitted to do a 60-day rollover.


I have a qualified immediate annuity (SPIA); can I suspend RMDs this year? No. An example is where a member is receiving periodic income from an immediate annuity purchased with IRA funds. Immediate annuities are special contracts governed by IRS rules that allow the annuitant owner to comply with their RMD as part of the pay out in the contract. Additionally, the annuity balance is not factored into their overall RMD calculation once the contract is annuitized. As such, since the payments cannot be suspended once started (unless the contract is commutated), neither can the RMDs which are part of the payments within the immediate annuity.


Retirement account owners should consult with their tax, legal, or financial professionals to discuss their specific situations regarding RMDs and rollovers back into retirement accounts. For more information contact:

  • USAA Life Service: 1-800-531-8903
  • USAA Brokerage: 1-800-531-6347
  • Victory Capital (USAA Mutual Funds): 1-800-235-8396


Robert Steen, CFP®, MBA | Advice Director | Retirement & Complex Financial Planning | Enterprise Advice Group



This material is for informational purposes and is not investment advice, an indicator of future performance, a solicitation, an offer to buy or sell, or a recommendation for any specific product.

USAA believes the websites and resources used to gather this information are reliable; however, we cannot guarantee the accuracy or timeliness of the information.


The contents of this document are not intended to be, and are not, legal or tax advice. The applicable tax law is complex, the penalties for non-compliance are severe, and the applicable tax law of your state may differ from federal tax law. Therefore, you should consult your tax and legal advisers regarding your specific situation. USAA or its affiliates do not provide tax advice. Taxpayers should seek advice based upon their own particular circumstances from an independent tax advisor.


DID No: 271071-0520

1 Comment
Occasional Visitor

good morning to you!

We have made the decision to suspend the RMDfor both of us this year.


What is my action step to convey that decision to you?


Thank you for your help and for a very good article!