RMD Scenario 2019 spouses and beneficiary pass away weeks apart
Wife (75 years old) passed away March 1, 2019 and husband (71 years old) was named as a beneficiary to her IRA. 2 weeks later the husband passes away without taking any action on the deceased wife’s IRA (he did not take distributions, rollover any funds or change any beneficiaries). How might distributions be structured for beneficiaries of the estate? Because the wife was past the RBD, can the beneficiaries take distributions based on the wife’s life expectancy? Or, would this be subject to the five-year rule since the IRA passed to the husband as beneficiary and he did not name a beneficiary to the IRA and passed before reaching the RBD?
Or, might there be other scenarios not being considered?
Permalink Submitted by Alan - IRA critic on Mon, 2022-09-05 19:14
These scenarios are always confusing. In this case husband cannot be treated as the IRA owner because wife passed post RBD. RMDs are based on the remaining single LE of husband. Husband’s estate or his beneficiares were responsible for completing wife’s 2019 RMD if not completed. 2020 RMDs were waived by the CARES Act. DIvisor for the 2021 beneficiary would be husband’s age in 2020 even though no 2020 RMDs, and the 2020 divisor is reduced by 1.0 for 2021. For 2022 the Table I divisors must be reset for the new 2022 RMD tables, and the annual 1.0 reduction continues. Executor should have long since assigned the inherited IRA out of husband’s estate to the beneficiaries under his will (or intestate rules), so each of those beneficiaries would maintain their own individual inherited IRA, but this does not change the divisors that apply.