Inherited IRA using lifetime RMD

Submitted by Mike Taft on Mon, 2020-03-30 13:02

I have read the bill and several analyses and summaries. I am still not clear on the following: I am 59 years old and have several Inherited IRA’s where I was named beneficiary. I have been using the lifetime RMD method and taking the RMD each year. Does this bill change that and I will not have to take RMD in 2020 (skip the RMD)?

Thanks
Mike



Submitted by Alan - IRA critic on Mon, 2020-03-30 14:58

  • Yes, you do not have to take a 2020 RMD. If you have taken a distribution from a non spouse inherited IRA earlier this year, you cannot roll it back.
  • Each year you have been reducing your RMD divisor by 1.0. With the RMD waiver, your next RMD in 2021 would be determined by using a divisor that is 1.0 less than what you would have used this year or 2.0 less than the divisor you used in 2019. You would use the account balance on 12/31/2020 with that 2021 divisor.
  • That said, new RMD tables were expected to be in place for 2021, at least prior to the crisis. If these are installed by the IRS effective 2021, you will have to “reset” your RMD divisors mentioned above. To do that you would enter the new table and determine the divisor for the first year you took beneficiary RMDs. From that new divisor you would subtract 1.0 for each year (including 2020) to get your new divisor for 2021. 

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