Inherited IRA
A women and her two siblings were named beneficiaries on their mother’s IRA. Mom died in December of 2015 over the age of 701/2. Being equal beneficiaries they completed paperwork with the Bank to receive equal amounts of $18k in a lump sum. My potential client has not received the check as of yesterday. Can she return the check and have her share retitled as inherited IRA to avoid the immediate tax?
Permalink Submitted by Alan - IRA critic on Fri, 2016-01-29 17:36
She can try, but the IRA custodian is not likely to accept it unless the bank is solely responsible for not following the customer’s clear request. If a beneficiary mistakenly requested a distribution instead of a direct transfer to an inherited IRA, the distribution is irrevocable. If the client feels they were led astray by the bank personnel who handled this, they can request a review, but that is unlikely to change the bank’s decision.