Can insurance company recalculate ages on a re-inherited, inherited IRA?

Submitted by Harve Senter on Sun, 2013-03-03 02:06

Where do I find IRS language telling the insurance company that they made a mistake and they cannot recalculate an inherited IRA when it is again re-inherited by the beneficiaries of the original inherited IRA owner? 82 year old wife has an inherited, trust owned IRA from husband. Inherited table shows 82 year old at 9.1. 2011 wife dies and three children are heirs. The three kids elect to take distributions based on Mom’s divisor, now 4.1. Insurance company insists on using kid’s ages and life expectancies for distribution not Mom’s. Where do I find IRS language telling the insurance company that they made a mistake and they cannot recalculate an inherited IRA when it is again “re-inherited” by the beneficiaries of the original inherited IRA owner? I cannot find it in Publication 590 – unless I missed something.



Submitted by Alan - IRA critic on Sun, 2013-03-03 16:16

Insurance company is incorrect. It’s on p 37 of Pub 590, and copied here:　　　　 

  • Other designated beneficiary.
  • Use the life expect-ancy listed in the table next to the beneficiary’s age as of his or her birthday in the year following the year of the owner’s death. Reduce the life expectancy by one for each year since the year following the owner’s death. If the designated beneficiary dies after Septem-ber 30 of the year following the year of the owner’s death, continue to use the designated beneficiary’s re-maining life expectancy to determine the distribution period; do not use the life expectancy of any subsesequent beneficiary.


Submitted by Harve Senter on Mon, 2013-03-04 15:59

Thank you so much.  My copy of the 590 is not a current one an that language is not in my copy – I just ordered a new one!



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