The IRS has updated comprehensive resources designed to help anyone making IRA contributions or receiving IRA distributions for tax year 2019 or considering making retirement donations before April 15, 2020.
The publications, both of which address the unique features of Roth IRAs and traditional IRAs, are the 2019 editions of the following.
Publication 590-A, Contributions to Individual Retirement Arrangements (IRAs), explains the rules for contributing to an IRA, with examples and worksheets illustrating how to correctly figure the contribution and deduction limits. Other topics it covers include rollovers, trustee-to-trustee transfers and what to do if too much is contributed to an IRA.
Publication 590-B, Distributions from Individual Retirement Arrangements (IRAs), which explains how to correctly figure required minimum distributions (RMDs) from traditional IRAs. In 2019, the RMD rules generally apply to anyone born before July 1, 1949. Those who turned 70½ during 2019 can choose to wait until April 1, 2020, to take their first RMD.
The IRS includes the reminder that for those planning ahead for 2020 and future years, the SECURE Act, enacted on Dec. 20, 2019, made several changes affecting IRAs and other retirement plans. They include generally allowing those born after June 30, 1949, to wait until they turn 72 to begin taking distributions from their traditional IRAs, and allowing those 70½ or older to make contributions to traditional IRAs.
The IRS also makes available Fact Sheet 2020-4, which addresses the following:
- contributing to a traditional IRA;
- distributions from a 401(k) or 403(b) to help cover costs entailed in the birth or adoption of a child;
- new rules for beneficiaries of IRAs, 401(k)s and 403(b)s;
- changes affecting 529 plans; and
- tax benefits extended through 2020.
The Fact Sheet outlines the tax provisions of the Further Consolidated Appropriations Act, 2020, the measure enacted Dec. 20, 2019 that includes the SECURE Act as part of its provisions, includes a number of tax provisions designed to encourage more people to save for retirement. It also discusses a number of other tax changes, including the retroactive renewal of some tax benefits that had expired at the end of 2017.
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