Successor Beneficiary RMD
Client’s Grandfather (Tom) passed in 2013 at age 90
Client’s Father (Jack) inherited Tom’s IRA in 2013 and passed in 2017 at age 69
Client (Jane) became Successor Beneficiary of Tom’s IRA when Jack passed in 2017
Jane continued RMDs using Jack’s life expectancy in the single life expectancy tables
Does the 10-year rule now apply or would Jane continue with RMDs using Jack’s life expectancy and the new tables?
This is a new client very confused about distribution requirements as prior custodian and advisor basically left them on their own to figure it out. Any help would be appreciated!
Permalink Submitted by Alan - IRA critic on Tue, 2022-12-06 15:49
Jane should be continuing Jack’s RMD schedule with annual divisor reductions of 1.0. She was responsible for completing Jack’s 2017 RMD if he did not complete it. 2020 RMDs were waived, and the final adjustment is for the new RMD tables starting this year. The divisor must be “reset” to determine what Jack’s age and initial divisor would have been in 2014, and since 8 years have passed since then, that 2014 divisor should be reduced by 8.0 to determine the 2022 divisor. The annual 1.0 reductions each year continue from that point.