Division of RMD among beneficiaries

Submitted by Andrew Cylke on Fri, 2014-01-10 16:06

I understand that any RMD not taken by an individual in the year of his/her death is required to be taken by the beneficiary(ies) during the year of death. If, for example, there were 4 beneficiaries and there was $20,000 of RMD remaining, could 1 beneficiary take $5,000 and be relieved of any liability from the 50% penalty if the other beneficiaries take nothing?



Submitted by Alan - IRA critic on Fri, 2014-01-10 16:25

  • Probably the penalty would be waived for that beneficiary, somewhat because the IRS often waives penalties for the year of death RMD since many beneficiaries do not even find out about the IRA until after the year ends and the amount the deceased took out is disclosed. The year of death RMD can be completed by beneficiaries in any combination assuming that there are not multiple IRA accounts with different beneficiaries. But this takes coordination between the beneficiaries.
  • In your example, the matter of completing the year of death RMD is also important. If the IRS waives the penalty for the others, it’s only because they filed a 5329 and provided evidence of completion of the RMD.

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