Changing IRA Beneficiaries After Spouse Passes Away

Submitted by Alice Severson on Sat, 2019-11-09 18:49

My parents (both over 75 and less than 10 years in age difference) have both been taking their IRA RMDs based on the Uniform Lifetime Table.

Mom’s beneficiaries were set up as:
Husband as sole primary beneficiary
Daughter (me) as sole contingent beneficiary

Since dad passed early this year, mom wants to change it to:
Daughter (me) as sole primary beneficiary
Family friend as sole contingent beneficiary

When we went to make these changes on Vanguard’s website, we received the message: “Changing your beneficiaries could affect your RMD calculations for future years.”

My understanding is that this warning message is important for people who were previously on the Joint Life Table because they will be switched to the Uniform Lifetime Table after removing their spouse as their sole primary beneficiary.

In my mom’s case, her RMDs will continue to be calculated based on the Uniform Lifetime Table, so this warning is not applicable to her.

Is my understanding correct?

Thank you in advance.



Submitted by Alan - IRA critic on Sat, 2019-11-09 20:17

  • You are correct. While she is living, changes to her beneficiary only affect HER RMDs if such changes triggered a change between the Joint life table and the Uniform Table. But there could be varied effects on her beneficiary after her death depending on what changes she made.
  • It is not clear whether Mom was Dad’s beneficiary or if she elected to become the owner of her inherited IRA and transferred it into her existing IRA. If she did not, she should elect ownership as there are disadvantages of maintaining his IRA as inherited given her age. 
  • Whoever inherited Dad’s IRA is responsible for completing his 2019 RMD if he did not complete it before passing. That should be done before year end to avoid having to request a penalty waiver on Form 5329.

Submitted by Alice Severson on Sat, 2019-11-09 22:11

Thank you for your help, Alan.  Good points, I should have added the following:

  • Mom was dad’s sole primary beneficiary, so dad’s IRA was transferred into mom’s IRA as part of a spousal rollover.  So after changing her primary beneficiary to me, she’ll continue basing her RMDs on the Uniform Lifetime Table, as she was doing previously.
  • After the spousal rollover was completed, I helped her complete an RMD for an amount that was the sum of her RMD and dad’s RMD for 2019, since neither had previously taken their RMD for 2019. 
  • Seperately from the IRA, dad had a 401K which mom disclaimed, so we’re handling that separately.  (Alan, you gave me a ton of help with this recently – paperwork is still in progress with Vanguard.)

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