Inherited IRA Distributions to Non- Spouse Beneficiaries
I am discussing this situation with my client’s accountant: 4 non-spouse beneficiaries inherit their father’s IRA; dad was over age 70 1/2 at death.
Assuming each beneficiary wants to stretch his IRA distribution, and each beneficiairy has a properly titled IRA Beneficiary Account, established by 09/30 following the year of Dad’s death, are the beneficiary RMDs based on the life expectancy of the oldest non-spouse beneficiary, reduced by 1 year each year? The accountant says that since each beneficiary has his own account, he can therefore use his own life expectancy factor, and not that of the oldest beneficiary. Which is correct? Thank you.
Permalink Submitted by Denise Appleby on Fri, 2007-09-21 17:06
Since each beneficiary established their separate accounts by December 31, of the year following the year the owner died, then they may each use their own life expectancies.
The oldest beneficiary’s life expectancy would be (required to be ) used, only if the assets were not segregated into separate accounts by December 31 of the year following the year the owner died.