spousal inherited IRA
just want to double check on the situation where the husband passed last week, he was 76 yrs old and has taken 3 months of his RMD. The wife is the beneficiary and is 75 yrs old. I think the best process is to move the IRA into an IRA under her name. Moving it to a beneficiary IRA doesn’t have much advantage. Is that correct?
Thank you.
Permalink Submitted by Alan - IRA critic on Mon, 2021-03-08 20:30
Yes. She should elect to assume ownership of the inherited IRA. By year end she will have to complete the 9 months of RMD husband did not take, but can either do that from the inherited IRA before she rolls it over or from her own IRA after the spousal rollover. She should move the funds by direct transfer because any 60 day rollover she does counts against the one rollover limit even if the rollover is from an inherited IRA to her own IRA.
Her own IRA RMD is not affected by this for 2021. Her total RMDs for 2021 are the total of what her own RMD would have been plus the uncompleted portion of her husband’s RMD for 2021 based on his 12/31/2020 IRA balance.