Based
on what I have read, in addition to the $1,200 per taxpayer, plus $500 per
dependent child under age 17, stimulus payment the economic relief package that
Trump has signed into law includes the following items of interest –
(1) There
is an automatic suspension through September 30, 2020 for payments of any
student loan held by the federal government – a “direct loan”. Interest will not accrue on the loan
during the suspension period.
(2) For
calendar year 2020 nobody will be required to take an RMD (required
minimum distribution) from any individual retirement accounts (IRA) or
workplace retirement savings plans (401k). This does not affect “traditional” pensions. This way the plan will not be forced to sell
investments at a loss resulting from the virus-inspired market drop to generate
cash to distribute.
(3)
You can make a premature withdrawal of up to $100,000 from an IRA or workplace
retirement plan for virus-related purposes without having to pay the 10%
penalty. The federal income tax on a
qualified withdrawal is spread over 3 years.
You can return all or part of the withdrawal before 3 years from the date
you took the withdrawal. You qualify for
the penalty exemption and special tax treatment if you, your spouse or a
dependent tested positive for the virus or you experienced negative economic
consequences related to the pandemic – for example from being quarantined,
furloughed, laid off, having reduced hours, or being unable to work due to a
lack of child care.
(4)
Taxpayers who do not itemize can deduct as an adjustment to income (deduction
from gross income) up to $300 in charitable contributions on their 2020
Form 1040 (or 1040-SR). This appears not
to be limited to tax year 2020.
TTFN
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