IRA benficiary question
Good morning:
Is there a way for an individual to allow for the primary beneficiary to be a surviving spouse and limit their access to RMD’s and income. Then when the surviving spouse passes, allow for the balance to go back to other family beneficiaries?
If so, then could the family beneficiaries open a Beneficiary IRA?
Could this scenario also be accomplished through a Trusteed IRA?
Thank you for your help in advance.
Permalink Submitted by Alan - IRA critic on Wed, 2018-04-11 16:41
A trusteed IRA could be used, but it is not a requirement. The IRA could establish a trust, perhaps a QTIP trust with provisions to do as they wish and name that trust as the IRA beneficiary. The age of the oldest trust beneficiary will determine the applicable RMD distribution period. If the trust provisions so specify or the trustee has discretion, separate inherited IRAs could eventually be assigned to the remaining beneficiaries.
Permalink Submitted by Bruce Steiner on Thu, 2018-04-12 21:50
Before you create a trusteed IRA, see my article on that subject in the September 2009 issue of Trusts & Estates: https://www.kkwc.com/wp-content/uploads/2015/04/uf_trusteed_IRA.pdf
Permalink Submitted by Brian Smith on Wed, 2018-04-25 19:53
It was mentioned earlier that the IRA could establish a trust, perhaps a QTIP trust with a provision to do as they wish and name the trust as beneficiary. Would there need to be a new separate trust created for this asset, if there is a current trust already in place? Or could they update the current trust? How do we ensure the trust docuement is drafted with the poper language to allow for QTIP for spouse and also for spouse to take RMD’s and the other beneficiaries to be able to ulitize the Inherited IRA Provision?
Permalink Submitted by Bruce Steiner on Sun, 2018-04-29 01:43
Permalink Submitted by Patrick Doyle on Thu, 2018-05-17 17:44
I’m leaving my wife an IRA in a QTIP, with my 7 children as eventual beneficiaries. We are both 80 years old, and she is withdrawing RMD from her own IRA. Will the QTIP RMD factor during her lifetimebe from the Single Life Expectancy Table (SLET), or from (SLET minus 1) ? Also, are the federal taxes due on the RMD to be paid after distribution to my wife, using her tax filing status as Surviving Spouse, or is the tax payment made within the QTIP prior to distribution using a different filing status? If paid within the QTIP, what filing status is used?