Roth IRA in an Irrevocable Trust
Can a Roth IRA be transferred to an Irrevocable (Grantor) Trust. If yes will it still maintain its Roth status (non reporting
of income)?
Can a Roth IRA be transferred to an Irrevocable (Grantor) Trust. If yes will it still maintain its Roth status (non reporting
of income)?
Permalink Submitted by Alan - IRA critic on Thu, 2018-09-13 18:06
A Roth owner cannot transfer ownership to a trust while alive, but can make a trust the beneficiary of the Roth. In that case, starting with the 6th year after the owner first made a Roth contribution, the inherited Roth will be qualified and tax free. RMDs would be based on the oldest trust beneficiary as long as the trust is qualified for look through. If the trust is not qualified for look through, the 5 year rule will apply.