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ONE NOTE ON THIS RELIEF: While it's true that anyone with an unwanted RMD can return it, many retirees will see no benefit from this, since they need those RMD funds to pay bills and
live on, so this will not help them. Many people take more than the RMD because they need the money. According to IRS numbers, that is 80 percent of those subject to RMDs. So this relief
applies mainly to the other 20 percent who don't need the RMD funds and would rather avoid the tax on RMDs they don't have to take. Bonus Q: If you paid taxes on your RMD, do you
get them back? —M.D. Some other retirees might benefit from not returning the RMD funds if they might be in a low tax bracket. That should be looked at before you rush to return your RMD.
Not taking an RMD is nice, but the tax never goes away. You'll just pay it in the future, so it will grow and might cost more later, so look before you leap. Not if you had the taxes
withheld from your RMD. If you had the taxes withheld, you can make up the difference from your own other funds to complete the rollover and still eliminate the tax bill. For example: Your
RMD was $10,000 and you had $2,000 of tax withheld. You won't get credit for that $2,000 until you file your 2020 taxes next year. If you want to return the full $10,000 RMD and you
paid $2,000 in taxes, you now only have $8,000, so you can use $2,000 of your other funds — say, from a taxable savings account — to bring the full return to $10,000 and eliminate the tax
bill. Any part of the RMD not returned will be taxable, so in this example, you'd owe taxes on the $2,000 that you didn't return to your IRA. However, if you had tax withheld, it
can be used to cover tax on other 2020 income, say from dividends, interest or capital gains — or to pay estimated taxes. The first installments of estimated taxes are not due until July 15,
so you have time to lower those payments to make up for any tax you had withheld from your returned RMD. BOTTOM LINE: All 2020 RMDs taken can be returned (rolled back over) if done by Aug.
31. _Ed Slott, CPA, is one of the nation's top experts on retirement plans. For more than 30 years, he has educated both consumers and financial advisors on retirement tax-saving
strategies. Most recently, he published _Ed Slott's Retirement Decisions Guide: 2020 Edition_ and is the host of several popular public television specials, including his latest,
_Retire Safe & Secure! With Ed Slott_. Visit www.IRAHelp.com to learn more._
