Five Year Rule Roth RMD Non-Spouse Beneficiary
Client converted an IRA to a Roth on December 29, 2011 and then passed away on December 19, 2016. I read somewhere that the five year period begins on January 1 of the year that the conversion or contribution occurs and then becomes qualified on Jan 1 of the sixth year. So, in this case and based on that logic, it looks like the holding period would begin January 1, 2011 and the end of the 5 year holding period would be December 31, 2015/January 1, 2016. Does this look right? It looks to me by that logic, that this inherited Roth IRA did become qualified and that the non-spouse beneficiary could use the lifetime RMD method and that all distributions would be tax free.
Am I correct on this?
Permalink Submitted by Alan - IRA critic on Tue, 2017-11-21 17:43
That is correct. Form 8606 is not needed to report further distributions.