Inh. Roth IRA
Quick question:
Client died with a Roth IRA in Aug., 2017. He never took any distributions from it and it was left to his 2 children. Client never took any distribution in 2017 since the Roth IRA was not subject to RMDs.
Question: Must each child take an RMD by Dec. 31, 2017 – even though no RMD was required by client since it was a Roth?
Please advise! Thank you.
Jason
Permalink Submitted by Alan - IRA critic on Wed, 2017-12-27 18:30
No, the first beneficiary RMD for the children will be due by 12/31/2018 using each’s share of the 12/31/2017 inherited Roth balance. These inherited Roths will be totally tax free if client first contributed to his Roth prior to 2014 (for distributions starting in 2018). Children should also create separate inherited Roth accounts no later than 12/31/2018 so that each can use their own life expectancy for RMDs. They could also elect the 5 year rule, but that is usually a bad idea.