IRA Inherited through Trust–which table to use?
In a scenario where an 85 year old husband dies in 2020, the beneficiary of his IRA is his trust and his wife (same age) is the beneficiary of the trust, which table does she us to calculate her RMDs? My initial assumption is that it’s the Uniform Table. But because it is coming to the wife via the trust, does she instead use the Single Life table?
Or, because the husband died in 2020 and named his trust as the beneficiary, are the RMDs no longer a factor in light of the SECURE Act and does the IRA need to be emptied out within 10 years?
This all assumes the trust qualifies as a conduit/see through trust.
Permalink Submitted by Alan - IRA critic on Wed, 2022-01-05 20:03
The Uniform table is not available for inherited IRAs, so as long as distributions are made to the trust and if the trust qualifies for look through as a conduit trust, if she is the sole beneficiary of the trust, she must use the SIngle Life table. But she does not reduce the divisor by 1.0 each year, she enters the table each year. Her attained age in 2021 would determine her 2021 RMD. For 2022 she must start using the new RMD tables and check those tables each year for the divisor.
If the trust permits her to distribute the IRA from the trust to her personally, which has been approved in several letter rulings, she could then elect to assume ownership and start using the Uniform table as an owner. This will substantially reduce her RMDs. But is is also possible that the IRA Custodian would resist the assignment request or ask her to get her own PLR, and that would set her back roughly 20k.