Inheritance of an Inherited IRA

Submitted by ann gunst on Fri, 2023-01-13 01:42

Client A inherited a distribution from his mother in 2014 (DOD 05.2014). Mother DOB 02.1930, she was in the distribution phase. Client A was taking RMDs as calculated over his expected life. Client A took RMDs through 2022. Client A DOB 07.1954. Client A died 02.2022. Beneficiary named by Client A is ultimately designated as the owner of the IRA. Several questions:
How should the IRA be titled?
What are the RMD options?
Thanks for your input!



Submitted by Alan - IRA critic on Fri, 2023-01-13 02:43

  • New beneficiary is a successor beneficiary. The inherited IRA should be titled showing the name of the successor beneficiary as beneficiary of A. Mother’s name should be dropped from the title. Custodians may require their own format for titling, and these formats are all OK with the IRS. 
  • Sucessor beneficiary must continue the RMD schedule of A. The divisors must be reset to reflect the new 2022 RMD tables which should also have been used for A’s 2022 RMD. The proper divisor for A’s beneficiary RMD for 2022 should be reduced by 1.0 for each year thereafter to determine the divisor for the successor beneficiary, who is also subject to the 10 year rule. The inherited IRA must be drained by 12/31/2032.

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