ira beneficiary disclaIm & RMD

Submitted by mike silvers on Thu, 2024-01-04 17:40

1) What is the procedure for an IRA beneficiary to disclaim an IRA after the IRA holder died?

2) IRA holder who died has been taking yearly RMD. Do the beneficiary also have to take yearly rmd or can they wait and take out the entire amount in year 10?

Thank you

Mike



Submitted by Alan - IRA critic on Thu, 2024-01-04 21:08

  • The beneficiary must file a qualified disclaimer form with the IRA custodian within 9 months of the date of death. 
  • Per RR 2005-36, the disclaimant is allowed to complete the year of death RMD of the decedent without being treated as accepting the inherited account, which would otherwise invalidate the disclaimer.
  • The beneficiary who inherits the IRA will be responsible for beneficiary RMDs as if they were the designated beneficiary of the account. If the beneficiary is subject to the 10 year rule, annual beneficiary RMDs are required only if the IRA owner passed after their RBD.
  • Note the additional details per RR 2005-36:  Revenue Ruling 2005-36 – Individual Retirement Account (IRA); decedent; beneficiary’s disclaimer (unclefed.com)

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