60 Day Rollovers
In one of the more recent articles we read that there are no 60 day rollovers for inherited IRAs. We understand that we cannot direct transfer or do a 60 day rollover from the original custodian account to a new custodian.
What we would like to know is that if the beneficiary sets up an inherited IRA at the same custodian as the original account and then wants to transfer the amount to an inherited IRA at a new custodian are we able to do a 60 day rollover instead of an ACH.
Thank you for your help!
Permalink Submitted by Alan - IRA critic on Wed, 2018-07-11 17:04
A non spouse beneficiary cannot do a 60 day rollover, therefore any distribution paid to the beneficiary will be irrevocably taxable. The money can only be moved to another custodian or to another inherited IRA at the same custodian by a non reportable direct trustee transfer. Your current custodian should not be refusing to do a direct transfer, but sometimes it is easier to have the check made out to your new custodian but given or mailed to you for delivery. That counts as a direct transfer. For example, if you want to transfer to Fidelity, the check should be made out to “Fidelity Investments FBO Paul Wealth inherited IRA”. Another option is to work with Fidelity and have them request the transfer on your behalf. There has been some discussion about changing the code to allow 60 day rollovers in this case, but so far no bill including that change has been voted on.