Multiple Stretch IRA RMD’s
My client was moving his stretch IRA via trustee to trustee transfer to my custodian but some of his illiquid reits won’t transfer. Due to heavy backloads we can not liquidate them for two more years. So now he is stuck with two stretch IRA’s both titled exactly the same. My question is, how do we handle the RMD’s. Can we calculate the RMD’s on both individual stretch IRA’s and then take the total of both RMD’s as a single distribution from just one of the accounts or are both accounts required to make the portion of the RMD?
Thanks for any help anyone can give me on this.
Permalink Submitted by Alan Spross on Fri, 2010-04-30 19:57
Yes, the RMD can be “aggregated”, meaning that they are calculated separately, added up and distributed in any combination desired over the eligible accounts. Taking the entire RMD from one of the accounts only is fine and it sounds like the account with your custodian would be the source of those RMDs.
Original custodian might advise client the amount of the RMD for that account, but client does not have to take anything out of that account and should probably advise that custodian that the RMDs are being satisfied from another account. After the two years is up, the cash from the REITS can be directly transferred to the newer IRA without distributing any RMD from that first account.
The above holds true whether the client owns these IRAs or inherited them from the same beneficiary.