Spousal Beneficiary
I have a client under 59 1/2 who needs money from her deceased husbands IRA and was over 701/2 at time of death. Can she leave the IRA titled in her deceased husbands name and take distributions yearly or as necessary as beneficiary or must she retitle the IRA, leaving her husbands name on the account and take distributions as beneficiary?
Permalink Submitted by Alan - IRA critic on Fri, 2017-02-10 19:48
I think you are asking if she must roll the inherited IRA over to her own or not. Since she needs to take distributions before 59.5, she should keep the IRA in inherited status until she reaches 59.5. The title should her as beneficiary and show the name of her husband as decedent. She should then roll it over to her own IRA at 59.5. Until she does, she must take beneficiary RMDs using Table I and her age each year. These RMDs are death benefits so there is no early distribution penalty. After she reaches 59.5, she should roll it over and that would stop RMDs starting in the year of the rollover until she reaches 70.5, but she can still take penalty free distributions as needed. She should also name her own successor beneficiary on the inherited IRA ASAP.