Claiming Inherited IRA
Grandmother died with TIRA leaving proceeds to 10 beneficiaries, grandchildren, all over age 24. A few grandkids are dragging their feet. How long do they have to claim their share of their grandmothers TIRA. What if they don’t do anything?
Permalink Submitted by Alan - IRA critic on Thu, 2024-08-15 17:15
There is no set time limit, but delays can cause several problems such as missed RMDs, missed deadline for creating separate inherited IRA accounts under which the age of each beneficiary can be used to calculate the RMDs. Further, if one of the GC was disabled and eligible to an EDB, they would lose that benefit if they missed the separate account deadline. They also will not be able to name their own beneficiary without a separate inherited account. Finally, a really long delay could result in the account being escheated to the estate.
Hopefully, the delays are not being caused by the custodian refusing to create separate accounts for the beneficiaries who provide the needed info until ALL beneficiaries do. If that is an issue, the other beneficiaries should insist that their separate accounts be created. That will free them up from the procrastinators.
If GM passed on or after RBD, annual RMDs are required in years 1-9 of the 10 year rule, and the beneficiaries are also responsible for completing her year of death RMD if she did not do so. That RMD would be much larger than the combined beneficiary RMDs.
Further details could be provided if GM’s DOB and DOD were posted.