Spousal Beneficiary IRA’s
Husband dies….wife establishes a “beneficiary IRA”….20 years later she wishes to have the balance rolled into her persoanl traditional IRA….Can she do it?
Husband dies….wife establishes a “beneficiary IRA”….20 years later she wishes to have the balance rolled into her persoanl traditional IRA….Can she do it?
Permalink Submitted by Alan Spross on Fri, 2011-01-21 22:33
Yes, she can do this anytime after spouse’s death. It will probably change the RMD requirement depending on circumstances.
Permalink Submitted by James Rosato on Fri, 2011-01-21 22:43
I thought the beneficiary’s had until Sept. 30th of the year after the year of death to make such a decision……..
Permalink Submitted by Alan Spross on Fri, 2011-01-21 23:52
No, the 9/30 is the date on which the designated beneficiaries are determined for RMD purposes, ie if one is paid off or their share disclaimed by then, they are not considered in determining RMDs.
But a spousal survivor can assume ownership at anytime. Sometimes it is best to wait until the surviving spouse reaches 59.5 to assume ownership as an inherited status avoids the 10% penalty. Sole spouse beneficiaries also do not have to start beneficiary RMDs until the deceased spouse would have reached 70.5. But once both those benefits no longer apply it is always best to assume ownership or roll the account over to their own IRA. This also protects the stretch for the successor beneficairies of the survivor.