inheirted ira
A client recently passed and had an IRA which he left to his to adult children as beneficiary. They recently received a letter showing the tax qualification as: Beneficial Owner IRA. Does that mean it was established as an inheirted IRA? I assume so, but just want to check. The letter also states Elected claim option: Delay distribution for up to 10 years. I know they are non-eligible designated beneficiaries. Just making sure this sounds right per secure act.
Thank you.
Permalink Submitted by Alan - IRA critic on Tue, 2021-01-12 17:35
Yes, this is OK. They also probably each have their own inherited IRA account, so they can manage them independently. They can move the inherited IRAs to a different custodian if they wish to, but only by a direct trustee transfer. Most likely, they will also benefit by managing distributions so they are not left with a large distribution in 2030 that could spike their marginal tax rate.
Permalink Submitted by Robert Ervolina on Tue, 2021-01-12 17:38
Thank you.