Spouse Beneficiary IRA’s
One of my clients, her husband passed away.
She is the Beneficiary.
What are the rules governing spouse as Beneficiary IRA
Thank you
One of my clients, her husband passed away.
She is the Beneficiary.
What are the rules governing spouse as Beneficiary IRA
Thank you
Permalink Submitted by Alan Spross on Wed, 2011-08-17 02:36
The surviving spouse can maintain the IRA in inherited form or can roll it over to her own IRA. Individual circumstances determine what is the best option. If the IRA is maintained as inherited, the surviving spouse can assume ownership later anytime they wish.
For example, if the survivor is under 59.5 and may need distributions, keeping the IRA in inherited form will eliminate any penalty on the distributions. If her husband passed before reaching 70.5, there is no RMD requirement until the year he would have reached 70.5. If she rolls it over her RMDs are figured the same as if she owned it all along, ie RMDs start at 70.5.
The best decision needs to factor in both their ages and whether the survivor needs funds before RMDs begin or not.