Traditional IRA conversion to stretch, post mortem
Is there a way to turn a traditional IRA into a “stretch” style IRA after the owner’s death when the traditional IRA lists the owner’s trust as the beneficiary. The owner has five children that are the beneficiaries of the trust.
Brian
Permalink Submitted by Alan Spross on Thu, 2007-12-06 05:07
IF the trust is qualified per page 38 of Pub 590, most of the stretch is preserved if the beneficiaries are in the same general age range. With a qualified trust, the RMD distributed to the trust is based on the oldest trust beneficiary. If the trust is not qualified and the owner passes prior to his RBD, the 5 year rule applies. If not qualified and owner passes after his RBD, the trust can take distributions based on the remaining non recalculated single life expectancy of the owner.