spouse inheriting an inherited IRA
Husband has an inherited IRA from his step father that the husband has been taking RMDs on. Husband then passes and named his spouse as beneficiary. Does the spouse have to continue RMDs or can she retitle the account as her own and stop RMD withdrawals? She is 67 yrs old. I cannot find any examples of this scenerio on the IRS website, only if you are a Non-spouse Bene or a Spousal Ben which gives you different options. It makes it look like if you are a non-spouse then you have to retitle and take RMD’s if the deceased would have been 70.5 and then once the bene IRA passes to a spouse it can then be retitled as her own. Wouldn’t she still be considered a spouse beneficiary technically and then stop the RMD withdrawal? Thanks for the guidance!
Ryan
Permalink Submitted by Alan - IRA critic on Tue, 2014-03-04 21:37
A surviving spouse can only assume ownership of an IRA if the decedent was the original IRA owner. Another way of putting this is once an IRA is inherited by a non spouse beneficiary and that beneficiary passes, the RMDs must continue under the same schedule that the non spouse beneficiary was using and would have used had they survived. That means the IRA would be drained in the same number of years. In Pub 590, see “Death of a Beneficiary” on p 37.
Permalink Submitted by Ryan Nichols on Tue, 2014-03-04 21:46
Thanks Alan!