Deceased IRA RMD

Submitted by Andy Reynolds on Tue, 2023-03-21 20:41

IRA Account Owner died in 2023 at age 88.
The IRA account owner did NOT take his 2023 RMD.
Spouse is 100% Primary Beneficiary.

Do the funds have to go into a Bene IRA first to take the RMD? From there will the funds go into the spouse’s Trad. IRA?

Thank you.

Permalink Submitted by Alan - IRA critic on Tue, 2023-03-21 21:26

When the death cert and beneficiary info is presented to the IRA custodian they will usually transfer the balance into a new inherited IRA for the spouse. The spouse should then immediately elect to assume ownership of the inherited IRA, and can then complete the year of death RMD from the owned IRA. Some custodians may be able to transfer the inherited IRA of the owner directly into an owned IRA for the surviving spouse. The 2023 year of death RMD does not have to be distributed until the end of 2023.
Surviving spouse should not delay in electing ownership of the inherited IRA because the Secure Act Regs will place a time limit for this election, which would be 12/31/2024. Best to do it right away, at the latest by the end of this year.