Beneficiary of Trust Owned IRA

Submitted by David Sloper on Tue, 2023-10-03 16:43

I have a client who inherited Beneficiary IRA’s from her Dad’s trust. Dad passed 2023 Her mom passed away in 2022. I assume based on the see through aspect of the trust that she will continue to take distributions based on 10 years from mom’s passing. Deplete IRA and Roth IRA by 12/31/2032.

Would this be correct? I am trying to piece all this together as mom and dad were not clients of mine and my client has not been great at getting proper documentation from Fidelity. It was explained that when mom passed the trust including these accounts were fully under Dad’s SSN, I was told.



Submitted by Alan - IRA critic on Tue, 2023-10-03 17:13

Mom would not be a factor if she did not own an IRA and pre deceased Dad. How many trust beneficiaries are there that are still living and are they all individuals? Is your client the trustee of the trust?  



Submitted by David Sloper on Tue, 2023-10-03 19:55

2 trust bene’s both individuals daughter and son. Mom owned a Roth and traditioinal IRA. I believe from what I have been able to gather the trust was the beneficary of mom’s IRA’s which was a revocable living trust with Dad’s SS #. Daughter was trustee.



Submitted by William Tuttle on Wed, 2023-10-04 00:25

It might seem like semantics, but a trust does not “own” an Inherited IRA. The trust is the beneficiary of the decedent’s IRA. When the trust qualifies for see through status, the trust beneficiaries are effective beneficiaries of the inherited IRA.



Submitted by Alan - IRA critic on Wed, 2023-10-04 03:06

  • When spouse’s with IRAs both pass over a short period, it is critical to be sure of the entire transaction sequence. Is it correct that when mother passed, the trust was her  beneficiary and not father? Or perhaps did father inherit it and the trust inherited at his death? Also, since both of them passed in a short period of time, it is more likely that both passed after their RBD for the TIRA, but Roth IRAs do not have RBDs so death was prior to the RBD for the Roth IRA. 
  • Has the trust info been submitted to Fidelity? There is a deadline of 10/31 of the year following the year of death to do that. If this deadline is missed the trust will fail qualification for look through. Therefore, if mother did leave her IRAs to the trust in 2022, there is only 4 weeks left to submit the trust data to Fidelity. 
  • Please confirm the chronology of events as the RMDs for the trust cannot be determined without these details.


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