June 22, 2020

IRS expands definition Qualified Individual, for Coronavirus-Related Distribution purposes.

The IRS issued Notice 2020-50, in which they expanded the definition of a Qualified Individual, for Coronavirus-Related Distribution purposes.

A qualified individual is one who is eligible to take a coronavirus-related distribution, and may be any of the following:

Under the CARES Act, an individual is a qualified individual:

  • who is diagnosed with the virus SARS-CoV-2 or with coronavirus disease 2019 (referred to as COVID-19) by a test approved by the Centers for Disease Control and Prevention (including a test authorized under the Federal Food, Drug, and Cosmetic Act);
  • whose spouse or dependent is diagnosed with COVID-19 by a test approved by the Centers for Disease Control and Prevention (including a test authorized under the Federal Food, Drug, and Cosmetic Act; or
  • who experiences adverse financial consequences as a result of:
    • the individual being quarantined, being furloughed or laid off, or having work hours reduced due to COVID-19;
    • the individual being unable to work due to lack of childcare due to COVID-19; or
    • closing or reducing hours of a business owned or operated by the individual due to COVID-19.

IRS Notice 2020-50 added: a qualified individual is an individual who experiences adverse financial consequences as a result of: 

  • the individual having a reduction in pay (or self-employment income) due to COVID-19 or having a job offer rescinded or start date for a job delayed due to COVID-19;
  • the individual’s spouse or a member of the individual’s household (as defined below) being quarantined, being furloughed or laid off, or having work hours reduced due to COVID-19, being unable to work due to lack of childcare due to COVID-19, having a reduction in pay (or self-employment income) due to COVID-19, or having a job offer rescinded or start date for a job delayed due to COVID-19; or
  • closing or reducing hours of a business owned or operated by the individual’s spouse or a member of the individual’s household due to COVID-19.

For purposes of applying these additional factors, a member of the individual’s household is someone who shares the individual’s principal residence

Cite: Section 2202(a)(4)(A)(ii) of the CARES Act; IRS Notice 2020-50

Written By

Retirement Dictionary Staff

Frequently Asked Questions Regarding

Share:

Share on facebook
Share on twitter
Share on pinterest
Share on linkedin
More

Related Posts

Forms Retirement Dictionary Financial Advice Retirement Advice

SAVE TIME

with our Cheat Sheets, Fact Sheets, Checklists & Books

Be among the first to know when

IRA Rules
Change

Forms Retirement Dictionary Financial Advice Retirement Advice

SAVE TIME

with our IRA Cheat Sheets, Fact Sheets, Checklists & Books