Inherited Inherited IRA

Submitted by Joseph Schwarz on Thu, 2023-06-29 15:21

Hi, I have an inherited inherited IRA question, the situation is:

Spouse A passes first in 2007 @ age 58
Spouse B has an inherited IRA from Spouse A and does not convert this to an IRA in their name
Spouse B passed away soon after, and also prior to age 59.5

The children now have an inherited inherited IRA that we had good guidance on prior to the Secure Act 2.0 for distributions. With the Secure Act changes, are the kids now effectively owners of an inherited IRA and can essentially “stretch” the IRA as if it was not an inherited inherited IRA? What table(s) should we use for this? Thank you kindly for your expert thoughts.



Submitted by David Mertz on Thu, 2023-06-29 16:42

  • The details indicate that Spouse B died prior to 2020 (soon after Spouse A’s death in 2007), so the Secure Act changes do not apply to Spouse B’s beneficiaries.  The Secure Act changes would apply to the children’s beneficiaries when the children die after 2019.
  • Because Spouse B died before the date when spousal beneficiary RMDs would have been required to begin, Spouse B’s designated beneficiaries (the children) are treated as original beneficiaries of Spouse B, not successor beneficiaries, and should have been taking beneficiary RMDs based on their Single Life Expectancies in the year following the year of Spouse B’s death, reduced by 1 for each subsequent year, and should be continuing to do so.  The only change is that the life expectancy factor for 2022 and beyond needs to be redetermined as if the recently updated Single Life Expectancies table had been in effect for the year following the year of death.

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