Aggregating IRA RMD Requirements Amongst Multiple Beneficiaries

Submitted by Tom Gibney on Mon, 2012-12-31 19:58

My uncle passed away on 1/6/12 at the age of 84. He bequeathed his IRA account equally among three separate non-spouse beneficiaries. The applicable funds have been appropriately transferred into separate IRA accounts for each beneficiary. Due to his death so early in the year, he did not meet his RMD for 2012. Two questions:
1) Are the 3 beneficiaries required to collectively satisfy my uncle’s 2012 RMD?
2) Can one benficiary satisfy the combined RMD requirement for all 3 beneficiaries? In other words, does the IRS care as long as the RMD is satisfied in total?

Thanks.



Submitted by Alan - IRA critic on Mon, 2012-12-31 21:13

  • 1) Yes, collectively, but not individually 
  • 2) Yes, one beneficiary can satisfy the year of death RMD, and the others would then not have to take a year of death RMD. This flexibility only applies to the year of death RMD for 2012. Starting next year, each beneficiary will have to take their own life expectancy RMD from their respective individual beneficiary accounts.
  •   Note that if the RMDs are not completed by today, they will have to file a 5329 requesting that the penalty be waived for “reasonable cause” per the 5329 Inst, p 6. Better if all 3 file it, but probably if the beneficiary who satisfies it files it with an explanation, it will probably suffice.

 



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