Roth IRA Spousal and Non-spousal Beneficiaries RMD
My father has a Roth IRA which lists his wife (my Mom), and his sons (my brothers and I) as primary beneficiaries.
After my father passes we would like to inherit the Roth and continue keeping the assets within a Roth IRA for as long as possible.
Can we split the inherited Roth IRA, where my Mom’s portion would be free from RMD and my brothers and I would be subject to RMD based on our own ages?
I understand that if this is possible, it would require creating separate Roth IRA accounts, which we prefer.
Thank You.
Permalink Submitted by Alan - IRA critic on Tue, 2015-05-19 02:45
Yes, this can be done. Separate inherited Roth accounts must be created no later than 12/31 of the year following the year of your father’s death in order for each son to use his own single life expectancy for RMDs. And your mother should roll her share over to her own Roth IRA for which she will have no RMDs. It is best for her to use the same deadline for this rollover.
Permalink Submitted by [email protected] on Tue, 2015-05-26 16:39
Since they want to “stretch the Roth IRA for as long as possible”, wouldn’t it be best for the sons to disclaim their portion, allowing it to all go to Mom, who has no RMD, and then have them listed as bene’s on her Roth IRA? Starting distributions only once she dies. Assuming their disclaimer would cause it all to go to mom as the sole primary at that point.-m
Permalink Submitted by Alan - IRA critic on Tue, 2015-05-26 17:30
Yes a disclaimer would probably stretch the Roth longer, but then there also is no guarantee the sons will get anything. Mom might have to use it for LTC or could become a dementia victim and spend it all. The sons would have to weigh this possibility against tapping the Roth sooner for beneficiary RMDs. Perhaps father was concerned about this also to have deviated from the usual 100% spousal beneficiary selection.