Transfer Form for Inheriting IRA
When filling out a Distribution Form for the Transfer of an entire Traditional IRA account from a Decedent to the designated Non Spouse Beneficiary, is it okay for “Traditional IRA” to be checked instead of “Inherited IRA”? The Custodian explained that “Traditional” is checked on this form only because the account that is being referred to was a Traditional IRA and is transferring to an Inherited IRA. (They call it a transfer but of course the entire account is being closed to be reopened under new account number as Inherited Beneficiary Account).The other RMD Distribution forms they have marked as Inherited IRA because they are referring to the RMDs the Beneficiary will take from the new Inherited IRA. I guess this makes sense? Thank you.
Permalink Submitted by Alan - IRA critic on Sun, 2016-11-13 22:16
Yes, OK for “traditional” to be checked. The main thing with these forms is to be sure that a direct transfer is being done since there is no way to offset the critical error of an actual distribution being made. Generally, these forms are not very clear to the ordinary user.
Permalink Submitted by Cheryl Van Beek on Sun, 2016-11-13 23:41
Thanks!