Proposed IRA Stretch Rules

Submitted by Jacob LaRue on Wed, 2019-10-02 17:56

With the new IRA stretch rules on the horizon have you heard anything about what happens in the following situation?

Client passes away, non spouse/child bene inherits ira, they name their own bene on the inherited ira, they pass away, new bene inherits the money. Does new bene get a new 10 year clock or does the new bene use the remainder of the original 10 years?



Submitted by Alan - IRA critic on Wed, 2019-10-02 19:00

  • Not sure if any of the proposals are that specific, but it is very unlikely that the successor beneficiary would receive any extension of the original 10 year period. Successor beneficiaries have never received such treatment in the past, so given the general legislative goal of more rapid depletion, it would not make any sense to extend the original 10 year period. 
  • As far as passage of some version of the current proposals, because of the current political atmosphere, it is becoming less likely that anything will be passed this year. That would mean another year of the life expectancy stretch for non spouse beneficiaries.

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