shake-out period or post-death GAP
My understanding is that this is the period from the year following the year of the IRA owner’s death where you can remove any of the beneficiaries (ie. pay off charities, disclaimer deadlines) to get down to the beneficiaries that would inherit an IRA. Are there any other rules, regulations, things I should know about this period in time?
Permalink Submitted by Alan - IRA critic on Mon, 2014-03-03 20:27
Yes. The 9/30 date in the year following death to eliminate named beneficiaries can also be effectively accomplished by creating separate accounts for the individual beneficiaries by 12/31 of that year. Also, note that the death of a non spouse beneficiary before the 9/30 date does not eliminate that person from still being “counted” as a beneficiary as of 9/30, but again the living beneficiaries can create separated inherited IRA accounts by 12/31 in order to use their own life expectancies for RMDs.