RETIREES AND THE ECONOMIC DOWNTURN

Retirees and the economic downturn. If you're a retiree with an investment account, you may be worried about recent volatility in the stock market. You're probably counting on your investments to help support you, so seeing their value fall can be very unsettling. The good news: The Coronavirus Air, Relief, and Economic Security Act (the CARES Act for short) has suspended required minimum distributions for 2020. That means if you were going to be forced to take money out to avoid a big tax penalty, you no longer have to. The suspension of the RMD requirements gives you the option to leave your money invested to ride out the bear markets. While this may not be possible for all retirees for financial reasons, it's a big benefit for those who with other sources of funds to liv on. The RMD suspension means you don't have to make withdrawals. Required minimum distributions are normally mandated for retirees with 401(k)s, IRAs, and certain other tax advantaged retirement plans. Retirees and the economic downturn.

Retirees must begin withdrawing funds after age 72 or 70 and a half if they hit this age prior to Jan. 1, 2020. IRS tables specify the amount of required distributions, and a 50% tax penalty is imposed on any distributions that were required but weren't made. For 2020, however, the passage of the CARES ACT means you don't have to withdraw any money if you don't want to. Why you may want to wait on withdrawals. You may not want to sell your investments if they have performed poorly in recent weeks due to the coronavirus crisis. IF you have the right asset allocation for your age, you're confident in your investment strategy, and you've invested in quality companies or broad market indexes. It's very likely your investments will recover over time. In fact, historically, markets have always been cyclical, and recessions and depressions have been followed by periods of growth. Retirees and the economic downturn.

IF you have time to wait out the market downturn without making withdrawals, you can avoid locking in losses, instead of selling amid the economic uncertainty resulting from COVID-19 and missing out on the recovery. You'll also avoid having to pay IRS taxes on that distribution amount, saving yourself some money in the process. For some retirees, withdrawals form investment accounts aren't necessary because of required minimum distribution rules, but because of the need for essential income.

If you ended up with a tax debt, we can help. We are a 36 year old Tax Resolution Company that can file any back tax returns, then determine your options in the IRS Code for Tax Relief. We are a Nationwide firm and will look at the IRS Fresh Start Program and all options that exist outside that program also. Our approach makes Tax Resolution stress free for you. Call for free Tax Resolution Services consultation today prior to the IRS putting a IRS Wage Garnishment or Bank Levy on you or your business. 1-888-689-7861