RMD from Residual IRA Balance
A 76 year old passed away last year and left her $180,000 IRA to her three sons. We distributed her remaining RMDs last year equally to her three sons who are all listed as beneficiaries. Her IRA was then transferred into three Inherited IRAs each for her three sons. There is now apparently about $150 of residual dollars still left in her IRA, but we are now in a new calendar year.
Do we have to do an RMD calculation for that $150 and distribute those dollars to each of the kids based on the deceased’s mom’s life expectancy, or can they just each transfer $50 into each of the Inherited IRAs and not worry about an RMD this year. Or, can we just have the custodian send each of the beneficiaries a check for $50 each since the dollar amount is so low and let them each pay the tax on the $50?
Thank you!
Permalink Submitted by Alan - IRA critic on Thu, 2022-01-06 15:34
The custodian probably set up the individual inherited IRAs for each beneficiary under their respective SSNs, then distributed 1/3 of the remaining 2021 year of death RMD to each. The custodian should now transfer 50 to each beneficiary’s inherited IRA and there would be no 2022 1099R needed as a result of the transfer. They are subject to the 10 year rule except for any disabled beneficiary, so they have no 2022 RMD except if a beneficiary was disabled, that beneficiary would have to increase the year end 2021 balance by 50 each to calculate that RMD.