Inherited IRAs held by a Spouse
A client’s spouse died on 1/13/2002 (his DOB was 8/14/1931) and his IRA was titled to her as an inherited IRA…even though she had her own IRA into which his account could have been transferred. (her DOB is 6/11/37)
The total RMD amounts are much larger than it would be if the 2 IRAs had been combined at his death. Can these 2 IRAs be combined now and use the total 12/31/07 balances to calculate the 2008 RMD?
Thank you.
Permalink Submitted by Al Fry on Thu, 2008-11-20 22:07
Has she been taking the RMDs from the Inherited IRA?
Permalink Submitted by Rosanne Schepis on Thu, 2008-11-20 22:26
…she’s been taking RMDs from the inherited IRA
Permalink Submitted by charles lore on Fri, 2008-11-21 01:35
She can now , or anytime , roll the inherited ira to her own. Not only that but also it is deemed she was the owner all along. As such I beliieve she could take the 2008 rmd based on 12/07.
Permalink Submitted by Alan Spross on Fri, 2008-11-21 02:50
Chuck is correct, but for a slightly different reason.
She is only deemed to be the owner if she actively assumes ownership OR fails to take the RMD required as a beneficiary. As long as the correct beneficiary RMD is taken, she is not deemed to be the owner.
Actively rolling it over OR failing to take the required 2008 RMD as a beneficiary will result in ownership status for the entire year of 2008. As Chuck indicated, she would then apply the 12/31/07 balance in determining her RMD, however using the Uniform Table.
Using the specifics in this case, she could have avoided RMDs until this year if she rolled the account over OR failed to take the RMD as a beneficiary, so hopefully she needed the funds.