Can I re-assign my inherited IRA to my wife?
Can I place my inherited IRA into my wife’s name? In addition, can I re-characterize the “inherited” status of the IRA to a “traditional” status? If so, what is my timeline to do so?
Can I place my inherited IRA into my wife’s name? In addition, can I re-characterize the “inherited” status of the IRA to a “traditional” status? If so, what is my timeline to do so?
Permalink Submitted by Jose Morales on Thu, 2011-04-21 16:02
The short answer is “no.”
If you inherited the IRA from a spouse, you could take it in your name. At that point you could name your new spouse as the beneficiary. Then when you pass away your new spouse could take it in her name. That would be the only way to “transfer” and inherited IRA into a spouse’s name. I’m guessing that you did not inherit this IRA from a spouse, and therefore this strategy would not work for you.
Recharacterization refers to changing the designation of one type of IRA contribution to another type of IRA contribution, such as from a Traditional contribution to a Roth contribution. If what you are realy asking is whether or not you can simply take the inherited IRA, of which you are a beneficiary, and make it your own IRA then you would only have this option if you inherited the IRA from your spouse.
Permalink Submitted by Alan Spross on Thu, 2011-04-21 16:57
I agree.
At times this same question arises as part of divorce or separate maintenance settlement. A taxpayer’s interest in his own IRA or an inherited IRA can be transferred under a “transfer incident to divorce” to the other spouse. This cannot be done without a court approved order or decree to do so and it is then executed as a non taxable direct transfer to the receiving spouse. It cannot be done by indirect rollover.
This is the only way an IRA can have an ownership change without the owner passing first.