Inherited IRA whos age for RMD
Client passed away (54yrs old) last year. Had his IRA go into a trust for his daughter who is 21.
I know she has to take a distribution this year (year after his death) but do we calculate the RMD based on his age or her age?
I thought it was her age, but the fund company is stating since it is a trust it goes by his birthdate and his date of death, is this correct since it is a trust or are they wrong and it doesn’t matter if a trust or not, it goes by the daughters age?
Thank you.
Douglas
Permalink Submitted by John Peterson on Wed, 2013-12-11 20:54
It depends on the terms of the Trust. If the Trust is now irrevocable (probably is) you should be able to look through the Trust and use the age of the oldest Trust beneficiary (hopefully daughter is the only beneficiary).
Permalink Submitted by Douglas Bauerband on Wed, 2013-12-11 22:13
yes, trust in irrevocable but no mention of whos age to use?
Permalink Submitted by Alan - IRA critic on Wed, 2013-12-11 23:38
If the trust meets the requirements of a look through trust, the oldest trust beneficiary’s age is used. IF the trust failed to meet the requirements, the 5 year rule would apply. Decedent’s age would not apply in either case here.