IRA Required Minimum Distributions: SECURE Act Changes When Distributions Must Begin
ComplianceTax & AccountingJanuary 03, 2020

IRA required minimum distributions: SECURE Act changes when distributions must begin

(Updated January 27, 2020)


The Setting Every Community Up for Retirement Enhancement Act of 2019 (i.e., the SECURE Act), which was included in the larger Further Consolidated Appropriations Act, 2020, has made several changes to individual retirement accounts (IRAs). One of the more significant changes is a provision which changes when traditional (including simplified employee pension – SEP) and Savings Incentive Match Plan for Employees of Small Employers (SIMPLE) IRA owners must begin taking required minimum distributions (RMDs). Effective for years after 2019, traditional and SIMPLE IRA owners will not be required to begin taking minimum distributions until they attain age 72. Prior to 2020, traditional and SIMPLE IRA owners were required to take distributions for the year they attained age 70½. Following is an overview of the effect this change has made.

Attainment of age 70½ before 2020

There will not be any changes for traditional (including SEP) and SIMPLE IRA owners who attained age 70½ before the end of 2019. They must continue taking distributions under the rules in place prior to January 1, 2020 (i.e., the SECURE Act provision’s effective date).

Example: John, born on June 30, 1949 attained age 70½ on December 30, 2019. John must take his 2019 RMD by April 1, 2020 (i.e., his required beginning date – RBD). Additionally, John must take his 2020 RMD by December 31, 2020, his 2021 RMD by December 31, 2021, etc.

Attainment of age 70½ in 2020 or later

IRA owners that were not age 70½ or older before the end of 2019, are subject to the new rules, effectively allowing them additional time before they must begin taking RMDs. Going forward, the RBD for traditional (including SEP) and SIMPLE IRA owners is April 1 of the year after attainment of age 72.

Example: Jane, born on July 1, 1949 attained age 70½ on January 1, 2020. As Jane was not 70½ prior to the end of 2019 she is subject to the new rule and is not required to begin taking distributions until the year she attains age 72. As Jane attains age 72 on July 1, 2021 she must take her 2021 RMD by April 1, 2022 (i.e., her RBD). Additionally, Jane must take her 2022 RMD by December 31, 2022, her 2023 RMD by December 31, 2023, etc.

RMD statements

By January 31 of each year IRA custodians and trustees are required to provide IRA owners in RMD status for such year with a statement which indicates the RMD amount (or offers to calculate the RMD amount), the deadline by which the RMD must be taken, and the fact that the IRA owner’s RMD status will be provided to the IRS.

It is likely that many statements used to report RMD information for 2019 (sent by January 31, 2019) and prior years indicated the deadline by which an individual must take his or her RMD is “December 31, unless it is the year in which an individual attains age 70½, then the deadline is April 1 of the following year”. Reference to age 70½ should no longer be included on any RMD statements, including those for 2020. Furthermore, any statements which refer to an April 1, 2021 RBD will be incorrect as no IRA owner will have an April 1, 2021 RBD (see the Examples above).

Update: On Friday, January 24, the Internal Revenue Service (IRS) issued Notice 2020-6 providing reporting relief as it relates to RMD statement reporting for 2020. The IRS states in the Notice:

"The RMD statement required under Notice 2002–27 should not be sent to IRA owners who will attain age 70½ in 2020. However, in recognition of the short amount of time after the enactment of the SECURE Act that financial institutions have had to change their systems for furnishing the RMD statement, relief is being provided.”

The IRS goes on to state that it will not consider statements (if sent) were provided incorrectly  to IRA owners attaining age 70½ in 2020 considering notification is provided to those individuals no later than April 15, 2020 indicating no RMD is required for 2020. Please see the article IRA RMD Statement Reporting: IRS Issues Notice Indicating Relief for 2020 Reporting.

IRS Form 5498 and reporting RMD Status to the IRS

Internal Revenue Service (IRS) Form 5498, IRA Contribution Information, indicates to the IRS any IRA owner that must take an RMD for the year in which the form is sent. In other words, when the 2019 Form 5498s are sent by May 31, 2020, box 11 should be checked for anyone that must take a distribution for 2020 (i.e., anyone that was 70½ or older by the end of 2019). However, data systems are also programmed to check box 11 for anyone that will attain age 70½ during the year in which the form is sent. Checking box 11 in this case would be incorrect as attainment of age 70½ in 2020 will not have any relevance to the RMD rules. Financial organizations should analyze their data systems and ensure that statements are not mistakenly sent to individuals who are not required to take an RMD in 2020.


The later RBD for traditional (including SEP) and SIMPLE IRA owners is only one of several IRA related provisions included in the SECURE Act. Wolters Kluwer continues to analyze the SECURE Act’s impact on forms, brochures, training, and reference materials. We expect updated rules as well as additional information and guidance to be forthcoming from the IRS.

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Mike Schiller
Manager, Specialized Consulting, Tax Advantaged Accounts
With more than 22 years of experience, Mike has worked closely with hundreds of financial organizations to help them create, implement, and maintain their tax-advantaged accounts program.