Can one switch inherited RMD elections after RBD?

Submitted by patricia Brennan on Wed, 2016-10-05 19:58

For an IRA inherited after the original owner’s required beginning date can the beneficiary change the RMD method after they start ( e.g. switch from original owner’s remaining life expectancy to there own?). Thanks!



Submitted by Alan - IRA critic on Wed, 2016-10-05 23:36

  • If the beneficiary is a non spouse, the RMD is based on the longer of the remaining life expectancy of the decedent or the life expectancy of the beneficiary. If the wrong choice was made to start with, it just means that more than the actual RMD has been distributed. Going forward the change can be made to the actual RMD divisors that should have been used, but the 1.0 reduction per year still has to be applied for the interim years.
  • For a sole spousal beneficiary, because the surviving spouse does NOT reduce the divisor each year, it is possible for the owner’s remaining life expectancy to start out to be longer than the beneficiary, but because the owner’s LE gets the 1.0 reduction and the surviving spouse does not, the RMD may change over to that of the surviving spouse in some future year, and this adjustment is allowed.
  • Advise if is this reply does not address the situation you have.

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