Does a Minor IRA Beneficiary under SECURE Act have an RMD during the period of their minority?
We have an annuity carrier that interprets the SECURE Act, et. al., as requiring a minor to take annual RMDs based on their life expectancy while they are minors (and presumably longer if students). Are they correct? When the minority period ends, the 10-year rule begins and only that one big 100% RMD applies. What do you think? Paul McG
Permalink Submitted by Alan - IRA critic on Tue, 2022-02-08 21:15
Yes, they are correct unless their custodian opts out of the LE RMDs and into the Secure Act’s 10 year rule assuming parent passed prior to RBD. Otherwise you are correct that the 10 year rule would not kick in until after the allowed LE period, which to date has not been fully defined with respect to higher education requirements. Of course these minor child LE RMDs could trigger the kiddie tax.