RMD Question

Submitted by Andy Reynolds on Wed, 2022-09-07 18:53

Husband died at age 67 in 2017.
Husband had a $1M account value in a 403(b) at a University.
Surviving wife has not withdrawn from the 403(b) nor has she moved the 403(b) at University. It is still in his name at TIAA-CREF, TIAA-CREF marked the account owner as deceased.

What is the surviving spouse’s RMD requirement in 2022?
What table does the surviving spouse use to calculate the 2022 RMD?
Can the surviving spouse transfer the funds into an Inherited IRA after taking the RMD and/or into her IRA at this time?

Thank you.



Submitted by Alan - IRA critic on Wed, 2022-09-07 21:25

  • If husband’s DOB was on or after 7/1/1949, according to proposed Secure Act Regs the wife would not have to begin beneficiary RMDs until the year husband would have reached 72, apparently this year. However, we do not know what the plan provisions provide relative to the 5 year rule, life expectancy RMDs, or a required election the surviving spouse needs to make between the above two options. It’s possible that the plan mandates the 5 year rule, and if it does the 5 years is extended to 6 years due to the CARES Act 2020 RMD waiver. So if the plan states that the 5 year rule applies, the surviving spouse could still do a direct rollover to an inherited IRA through year end 2022. If this is not done, once 2023 begins (the last year of the 5 year rule) since the entire balance is treated as an RMD, none of it is eligible for rollover, and the entire balance will be taxable.
  • For several reasons, including spouse’s lack of action, Secure Act pending Regs, and unknown plan beneficiary provisions, this scenario is very complex.  If the 5 year rule applies, there is no beneficiary RMD for 2022 (4th year of the 5). If LE RMDs apply, the 2022 RMD is based on surviving spouse’s attained age this year and the new single life table. In that case, this particular beneficiary RMD would need to be distributed before doing an IRA rollover. Surviving spouse can do a direct rollover to her own IRA. The only reason for a direct rollover to an inherited IRA would be if she is under 59.5 and will need funds before reaching 59.5.

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