ira/bda mrd status if trust is disolved
An IRA/ BDA is linked to an irrevocable trust. The spouse died and the trustee/beneficiary is considering dissolving the trust, with approval from his remainder beneficiaries who are his children, instead of creating a remainder trust for him that was supposed to be created upon the spouses death. If the trust is dissolved, would the mrd be the same as the spouse’s or based on his life?
Permalink Submitted by Alan Spross on Fri, 2010-12-24 00:36
The RMD would be based on the age of the oldest beneficiary of the trust and if I understand your post correctly, that would be the surviving spouse. This assumes the trust is qualified for look through treatment. The surviving spouse may also be able to roll over the IRA, and if so that would change the RMD requirement.
Permalink Submitted by Harold Porter on Fri, 2010-12-24 01:58
The surviving spouse died, so if the trust is disolved, would the remainder beneficiary, her son, take mrd’s based on her life or his?
Permalink Submitted by Alan Spross on Fri, 2010-12-24 04:53
On her life because she was apparently the oldest beneficiary of the trust at the time of original owner’s death. Successor beneficiaries do not get a new stretch.