Welcome to the Bowman financial strategies, retirement nights, simple series. Your host is Erik Bowman, retirement income certified professional and certificate holder of the national social security association.

Hi everyone, Erik Bowman here and today I am going to be covering three extremely important changes to tax law for 2020 that impact you. 

The first one is the filing tax deadline has been extended until July 15th. So that's coming right up. And what that means is you didn't have to file by April 15th, you can wait until July 15th. But it also means if you have not paid any of your estimated taxes or your taxes due, you don't have to until July 15th. The automatic extension to October still applies, you can file for that or ask for that extension. However, to avoid interest and penalties, you will still want to pay your estimated tax burden by July 15th. 

The second change is the contributions to IRAs. That deadline typically is the filing deadline. So, for example, to make IRA contributions for the calendar year, 2019, you typically could make those contributions up until April 15th. But since they've moved that filing deadline to July 15th, you now have still a couple of days to make contributions if you have not done so. And don't forget that most of the time, your contributions into your IRAs are tax deductible, which means it will save you on taxes. In addition, this rule also applies to health savings accounts, or HSAs, an extremely tax beneficial account for those that actually have it. 

And the third rule are changes to the required minimum distributions required. Minimum distributions are those required withdrawals from your IRA that you ultimately have to pay taxes on because the government wants their money. Well, they have waived required minimum distributions for the tax year 2020, meaning you don't have to take them. And this could be really important to a household that takes required minimum distributions but doesn't really need that cashflow. So, they're paying taxes on cashflow that they simply don't need. And in addition, if you've already taken your required minimum distribution, you can actually unwind that so that you don't have to pay the taxes on that distribution. Thanks very much for joining me today. I hope you enjoyed it

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