November 30, 2009 Relief Regarding Waiver of 2009 RMDs

On December 23, 2008, Congress enacted the Worker, Retiree, and Employer Recovery Act that included a provision suspending the application of the required minimum distribution (RMD) rules for 2009.  These rules state that the normal 2009 RMD is not required for 2009 for defined contribution plans and IRAs.  This includes lifetime distributions for those age 70 1/2 or older and also distributions to heirs of inherited accounts.  The suspension did not apply to those who turned age 70 1/2 in 2008 and who chose to defer the first RMD to 2009 (not later than April 1).  Some taxpayers were unaware of this new law and received distributions in 2009 that were intended to comply with the RMD.  The IRS has just issued Notice 2009-82  granting an extension of time until November 30, 2009 to rollover the unnecessary 2009 distribution that was received to comply with the 2009 RMD.  Certain requirements of the notice must be met.