Husband owns Roth IRA, has satisfied the 5 year and 59.5 rule, then dies. Wife is also older than 59.5, but has never owned her own Roth, assumes husband’s Roth as her own. Does she still need to satisfy her own 5 year rule? I’m assuming all funds would go into her Roth tax-free, but would any future growth need to satisfy the 5 year rule to be tax-free? Thank you
With this fact pattern, wife inherited a qualified Roth IRA. She can assume ownership and that will eliminate beneficiary RMDs. The 5 year holding period of her spouse is applied to her and because she is also over 59.5, her Roth IRA is immediately qualified and tax free with no RMDs. Had she not been 59.5 the Roth would not be qualified until she reached 59.5. Her distributions do not have to be reported on Form 8606, just on line 4a of Form 1040, nothing on 4b (taxable line).
Permalink Submitted by John Boyle on Thu, 2023-12-07 03:04
No need to answer, I just noticed a similar question was asked and answered recently.