RMD for spousal beneficiary

Submitted by Adam Bunday on Thu, 2023-11-02 17:29

Spouse of husband passed away in 2021 at age of 64. She had assets under her 403b account that were retained as spousal beneficiary 403b account to defer RMDs because surviving husband is 7 years older. He should be able to delay starting any RMDs from that account until she would have turned age 73 in the year 2030. He is wanting to rollover part of that account to a Spousal Beneficiary IRA account for higher fixed rates. Will he be able to continue to delay RMDs until she would have been age 73 from the new Spousal Bene IRA?



Submitted by Alan - IRA critic on Thu, 2023-11-02 20:25

  • Yes, his beneficiary RMDs do not start until spouse would have reached 73. However, his option to elect to be treated as the owner of the inherited IRA per a new provision in the Secure Act is the end of year in which he reached 72, his RMD age. That appeared to have been in 2022 if he was born in 1950. He can still become the owner of the inherited IRA by doing a 60 day rollover to his own IRA but he must have a rollover available to do that. Since beneficiary RMDs would begin in 2030, he should plan on doing the 60 day rollover to his own IRA in 2030 since doing that will allow him to use the Uniform Table and erase the single life table beneficiary RMD for 2030. He should avoid any other 60 day rollovers for any of his IRAs for 12 months before he plans to do the 60 day rollover so his will be eligible to do that rollover to his own IRA.
  • Another new provision in Secure Act 2.0 effective in 2024 will also provide him with the option to elect to assume ownership of the inherited 403b plan if he prefers that instead of an IRA. That would eliminate the one rollover restriction between IRAs. 
  • In short, he will become subject to a confusing combination of deadlines a few years down the road.

Submitted by Adam Bunday on Fri, 2023-11-03 14:26

Thank you so much for the very helpful feedback!  

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