Spousal IRA Rollover Question
I have a client whose wife died earlier this year after taking the required distribution from her IRA. Husban and wife are both in their mid-70s. As sole beneficiary of the IRA, the husband elected to distribute the entire balance and received a check payable to him. Can this amount be rolled into a Spousal IRA in his name within 60 days of receiving?
Permalink Submitted by Alan Spross on Fri, 2011-08-19 17:38
Yes, he has 60 days to roll it over to his own IRA, but I wouldn’t refer to it as a spousal IRA.
While he also could set up an inherited IRA, with their ages as stated, there is no benefit to that and RMDs would be larger. He definitely should roll it over before the 60 days run out unless he needs the money for current expenses.
Note that if his wife had any basis from non deductible contribution in her IRA, he also inherits the basis remaining for his own IRA. He would file an 8606 to report it. In this case it would be easy to tell if there is any basis by looking at their 2010 tax return to see if there is an 8606 attached under her SSN. Finally, he obviously needs to update his beneficiaries.