IRS Releases FAQs on SECURE 2.0 Disaster Relief
The Internal Revenue Service (IRS) has released a set of frequently asked questions (FAQs) regarding rules for distributions from retirement plans and individual retirement arrangements (IRAs) under Section 331 of SECURE 2.0 for individuals affected by federally declared major disasters. These FAQs provide general information on:
Taxation and reporting of qualified disaster recovery distributions,
Repayment of qualified distributions taken for the purpose of purchasing or constructing a principal residence in a qualified disaster area, and
Loans from certain qualified plans.
The IRS indicates that as these are FAQs provided for general information, they will not be relied on or used by the IRS to resolve a case. However, taxpayers who reasonably and in good faith rely on these FAQs will not be subject to a penalty that provides a reasonable cause standard of relief.
