Took a Coronavirus Withdrawal From Your Retirement Plan in 2020? Time May Be Running Out to Repay It and Save on Taxes
In 2020, many people found themselves in a tough financial spot. Unemployment soared in April that year in the wake of the COVID-19 crisis, and many people who were out of work couldn't return to a job due to health-related concerns.
Lawmakers had to act quickly to prevent a full-blown financial crisis. Not only did they boost unemployment benefits and approve stimulus checks, but they also made it possible for savers to tap their retirement plans penalty-free to cope with the economic blow of the pandemic.
Under the CARES Act, which was passed in March 2020, savers could take a withdrawal of up to $100,000 from an IRA or 401(k) plan without penalty. Usually, a 10% early withdrawal penalty applies when funds are removed prior to age 59 1/2.
Source Fool.com
