Inheriting a beneficial IRA
Sister 1 died and left an IRA to Sister 2. Sister 2 elected to stretch the bene IRA out over time and did so for many years. Sister 2 then died and left her bene IRA to her brother. Sister 2 also had her own IRA that she left to her brother as well.
Can the brother consolidate the two inherited IRA’s even though one of them was an inherited bene IRA?
I had a broker/dealer lump them both together in a transfer to the Brother’s bene IRA at a different BD.
I am wondering if they did this in error.
Permalink Submitted by Alan - IRA critic on Wed, 2014-04-16 19:54
They should not have been combined because the RMD divisors are different. Combining them will cost the brother much of his stretch on the IRA he inherited directly because he will have to continue the sister’s RMD divisor on the entire combined balance now. Perhaps a transfer can be done now to separate the accounts again and correct the error.