RMD in year of Death
88 year old died in February and left his pre-tax IRA to two children, split 50/50. RMD for 2021 not yet taken. One child is a high earner and the other is a low earner. Can the low earning child take the entire 2021 RMD? If so, must it be taken before the account is split and sent via trustee to trustee transfer to the inherited IRAs?
Thanks in advance!
Joe
Permalink Submitted by Alan - IRA critic on Fri, 2021-03-26 18:12
The year of death RMD can be completed by any beneficiary, so the low earner can distribute the entire year of death RMD. Normally, the separate inherited IRAs must be established, or at least the one for the lower earner child. The RMD can then be taken anytime in 2021 from the new inherited IRA. This also simplifies the split accounting process, since the first beneficiary to establish their inherited IRA should receive 50% of the balance in the decedent’s account, and then the year of death RMD will not affect the other beneficiary or their balance.