By Andy Ives, CFP®, AIF®
IRA Analyst
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Question:
Hi. What are the rules for QCDs now that required minimum distributions (RMDs) have been cancelled for 2020?
Thanks for your help.
Jerry
Answer:
Jerry,
Qualified charitable distributions (QCDs) are unaffected by the CARES Act. Even though RMDs are waived for 2020, you can still do a QCD if you otherwise qualify. While QCDs are a popular way to offset the income from an RMD, they are not required to coincide with an RMD. “Voluntary” withdrawals can just as easily be removed from income by a QCD.
Question:
In January 2020 I converted money from my traditional IRA to a Roth IRA. Can I undo the conversion? If so, is there a time limit to do this by and are there any stipulations?
Thank you,
Mike
Answer:
While Roth contributions can still be recharacterized, conversions such as yours cannot. Roth conversion recharacterization was eliminated a couple of years ago by the Tax Cuts and Jobs Act. It may be wishful thinking but, with the recent market collapse and all the financial support offered in the CARES Act, the IRS could decide to temporarily allow conversion recharacterizations. However, I am sorry to say that, as of now, there is no going back on your Roth conversion.
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