inheriting-inherited IRA
Individuals husband died 11/30/2021, the husband had inherited a TIRA from his mother and was taking RMD’s annually. He had named his wife beneficiary of the inherited IRA. Is the new beneficiary (wife) subject to the new 10 yr distribution rules, or can she continue to take RMD’s at the same rate her husband was? The original IRA owner died 8 to 10 yrs ago.
Permalink Submitted by Alan - IRA critic on Mon, 2022-04-04 22:17
The successor beneficiary wife is responsible for completing husband’s LE RMD for 2021 if he did not complete it. She would have to file a 5329 to request penalty waiver if not done in 2021.
Husband is treated as if an eligible designated beneficiary for purposes of his post Secure Act death, and wife therefore becomes subject to a new 10 year rule with inherited IRA drained by 12/31/2031.
However, the new proposed Regs purport to carry this a step further if mother (that’s right, the original IRA owner) passed on or after her RBD. The proposal is that wife in addition to the 10 year rule would continue to be subject to annual RMDs, presumably continuing the RMD schedule of husband after resetting the divisors for the new 2022 tables. A decent change that this proposal provision will not survive due to complexity and lack of practical need.