RMD’s in the year of death…
A ciient died Jan 2010 and was 78 years old. How is RMD handled from his TIRA? I believe we must take the RMD for 2010 before the beneficiaries receive the proceeds from the TIRA. Who/where does the RMD for 2010 go to (spouse pre-deceased client)?
Permalink Submitted by Anonymous (not verified) on Wed, 2010-01-27 18:06
At the point when the IRA owner passed away, the IRA is owned by the named beneficiaries. If the RMD has not been satisified, it must be distributed by the beneficiary in 2010. If there are more than one, I am not aware of any special rule that describes in what proportion. This is clearly outlined in the Final RMD Regulations of 2002. I don’t think you will be able to convince an IRA custodian to create a taxable event for a deceased person, unless you do not inform them of his death – and that would be providing false information.
As to the process, each custodian may have different procedures and workflows. At the end, the final RMD distribution should be reported under the SSN of the beneficiay. Sometimes this will happen before the account is Inherited/Assumed, in a quasi “behind the scenes” transaction.
pmk