Inherited Roth IRA for non spuse benficiary

Submitted by Scott Carbaugh on Fri, 2017-06-23 01:37

Is it true that a non spouse who inherits a Roth IRA is subject to RMDs and payment of taxes upon distributions?

If so, would it ever make sense to name a non spouse beneficiary of a Roth IRA when a spouse is in existence?



Submitted by Alan - IRA critic on Fri, 2017-06-23 02:58

Normally, a non spouse beneficiary would not be subject to taxes despite the RMD requirements. The account is totally tax free starting after 5 years from the year the deceased owner first made a Roth contribution. Even prior to the 5 years, only the earnings in the inherited Roth would be taxable and earnings are distributed last. Therefore, in most cases the non spouse beneficiary would not be paying any taxes.

Submitted by tomd37 on Fri, 2017-06-23 03:14

Alan – Should be inherited non-spousal Roth IRA be kept separate from any other Roth IRA the non-spouse beneficiary might have?  My thinking is it must be kept separate as RMDs are required on this particular Roth IRA where RMDs are not required on any other regular Roth IRA the beneficiary might hold.   PS: Stay cool!  I watch the weather in your location every day as a good friend from our neighborhood moved to your town a year or two ago.  Talked with him a couple of weeks ago.  Tom D.

Submitted by Alan - IRA critic on Fri, 2017-06-23 17:59

  • Tom, you are correct. The inherited Roth must be kept separate except for other Roths inherited from the same decedent. If beneficiary also inherited a TIRA, the RMDs for the inherited TIRA and inherited Roth must also be separately distributed. 
  • Yes, major heat wave here and lasting much longer than prior ones!

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