Personal Finance

Coronavirus relief bill would relax rules on retirement savings


U.S. Senate Majority Leader Sen. Mitch McConnell (R-KY) speaks to members of the media during a news conference at the U.S. Capitol March 17, 2020 in Washington, DC.

Alex Wong | Getty Images

A series of key retirement provisions have made it into the latest version of the $2 trillion coronavirus relief bill.

Tucked into the measure are a series of changes that would relax rules on retirement savings, including a line item that would allow you to take a hardship distribution of up to $100,000 from your 401(k) plan without the 10% early withdrawal penalty if you’re under age 59½.

Retirees can also suspend required minimum distributions out of their retirement accounts for 2020, according to the bill.

“I do like the delay of the required minimum distributions because the value of many retirees’ accounts has fallen this year,” said Nicole Kaeding, vice president of policy promotion at the National Taxpayers Union Foundation in Washington. “It gives retirees flexibility especially if they don’t need the income.

“They leave the money in the account and let the market rebound,” she added. “From the withdrawal side, drawing from the account while the market’s down isn’t always the best strategy, but Congress is providing the flexibility for those who need it.”

Here are three retirement relief measures in the package.

Tax-favored plan withdrawals

The Senate’s bill would allow affected savers to take coronavirus-related distributions of up to $100,000 from retirement plans and individual…


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