The year of death RMD is the same as if IRA owner had lived all year. The uniform table applies unless he had a sole spouse beneficiary more than 10 year younger. The uniform table divisor is 15.5 unless he would have turned 85 by year end. If the full RMD was not taken prior to death, the beneficiaries must take it. It is reported and taxable to the beneficiaries. For the children beneficiaries, if they create separate accounts prior to 12/31/2009, each can use their own life expectancy from the Single Life Table based on their age reached in 2009. Each year after that, the divisor is reduced by 1.0. If they fail to create separate accounts by 12/31/2009, the life expectancy of the oldest will apply to all of them.

If IRA is left to a sole spouse beneficiary, the 2008 RMD is handled as above. It is the same as would have been required had owner not passed. For 2009, if the spouse rolls it over or assumes ownership, the 2009 RMD will be based on the spouse’s age in 2009 using the uniform table. If spouse is younger than 59.5, they may wish to take beneficiary RMDs to avoid early withdrawal instead of assuming ownership, then roll it over after reaching 59.5.

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