Non-Spousal ROTH IRA Beneficiary
What is the current IRS requirement for Required Minimal Withdrawals (RMW) for a non-spousal beneficiary of a Roth IRA where the deceased owner died after their Required Beginning Date? With the 10-year withdrawal requirement under the SECURE ACT, can the non-spousal beneficiary wait until the end of the 10th year to withdraw the entire account or must they do an annual RMW and deplete the inherited account by end of 10th year? Thanks very much for all your assistance.
Bob Santucci
Permalink Submitted by David Mertz on Sun, 2022-04-10 17:31
A Roth IRA has no required beginning date for RMDs, so a Roth IRA owner is treated as dying before the required beginning date for distributions. Unless the beneficiary is an Eligible Designated Beneficiary (the most common non-spouse EDB being a beneficiary who is not more than 10 years younger that the decedent), the inherited Roth IRA must be completely distributed by the end of the 10th year following the year of death of the owner, with no requirement for annual distributions. However, if the beneficiary is an EDB and does not elect to be treated as a non-EDB, the EDB is subject to annual RMDs with no 10-year requirement.
Permalink Submitted by Alan - IRA critic on Sun, 2022-04-10 17:59
Because a Roth IRA does not have RMDs for owners, there is NO RBD. Accordingly, all owners pass prior to the RBD. Under the proposed Secure Act Regs, non spouse beneficiaries of Roth IRAs subject to the 10 year rule will not have to take annual RMDs in years 1-9. Further, because delaying all distributions until year 10 will not produce any taxable income while generating more tax free gains, that would be the best plan.