Beneficiaries 101
I would like to know if my perception as to who can and who cannot rename beneficiaries is correct. A surviving spouse who is the primary beneficiary can assume an IRA that has secondary beneficiaries and can then rename beneficiaries. A non-spouse that inherits an IRA that has secondary beneficiaries cannot rename those beneficiaries. Are those statements true?
Permalink Submitted by Alan Spross on Fri, 2009-04-17 02:18
The first one is correct. A sole surviving spouse can maintain the IRA in inherited form or assum ownership. Either way, the original secondary beneficiaries are voided unlesss the primary beneficiary disclaims.
The non spouse beneficiary can also name successor beneficiaries to the inherited IRA.
In both cases successor beneficiaries should be named since the original secondary beneficiary designations become void when the owner passes unless the primary beneficiary disclaims.
The above comments address who receives the right to the IRA funds when the current owner or beneficial owner passes. How the RMD requirements of the successor beneficiaries are affected is a different issue that whether they will inherit the funds in the first place.