As we continue to navigate this ever-changing environment, we wanted to provide you with some updates regarding your accounts with us here at TRUE.
On the asset management front, we executed our quarterly rebalance last week and took advantage of the late-week market pull-back. We made a few tactical changes to each portfolio, which we would be happy to discuss with you individually if you have questions. The Gescher Herber Group maintains our belief that the US had a strong economy going into this season and will have the financial wherewithal and horsepower to recover quickly.
Although the unemployment claims reported yesterday, April 2, 2020, were shocking and well in excess of the highest estimates, the market moved in a positive direction. At this point we anticipate there will be more headlines and more volatility to come, but only time will tell. As we all know, the longer this economic shutdown continues, the more the economy will be affected. As information is disseminated, we are prepared to act accordingly, and as always, we will keep you informed.
On Friday, March 27th, President Trump signed into law the CARES Act (Coronavirus Aid, Relief, and Economic Security Act). There are a few provisions of this bill that will affect retirement accounts, but these details are still being ironed out. Here is what we know so far:
2020 RMDs can be waived for all retirement accounts, including Inherited IRA/BDA accounts
If you have already taken a 2020 RMD within the last 60 days, we can reverse withheld taxes and return your distribution to your IRA if you choose. Unfortunately, this does not apply for Inherited IRA RMDs.
QUALIFIED Coronavirus related distributions from your IRA will not be charged the 10% penalty tax for those under 59.5 years of age. We strongly suggest you discuss any possible distributions with us and/or your tax advisor to ensure the proper reporting is done to avoid any penalties.
Please let us know as soon as possible if you would like to reverse your Q1 2020 IRA distribution or stop any future 2020 distributions from your IRA.
Finally, the IRS has postponed the 2019 tax filing deadline to July 15th. As part of this extension, the 2019 IRA and HSA contribution deadlines have also been moved to July 15th. All 2019 contributions must be postmarked to Fidelity prior to this new deadline. As a reminder, the maximum contribution for those under 50 years of age is $6000, and $7,000 for those aged 50 and above. Health Savings Accounts can now be opened at Fidelity, with an annual contribution limit of $3,500, or $4,500 for those above the age of 55.
Our best to you and your families during this time. We hope you are staying safe, sane, and healthy.
Todd, Jason & Rachel
