Client (spouse) inherited an already inhertired IRA from his wife who inherited it from her father.

Submitted by James Biasotti on Thu, 2021-06-24 22:50

What are his options? I believe from research- he takes title as an inherited IRA from his deceased wife and contuniues RMD’s based on her life expectancy each year as before and not on his? Or does SECURE ACT 10 year rule apply?



Submitted by Alan - IRA critic on Thu, 2021-06-24 23:20

Dates dates of these events matter. If the father passed prior to 2020, and his daughter was directly named as beneficiary, she was taklng RMDs over her single life expectancy. And if she passed after 2019 (under the Secure Act), client is subject to a new 10 year rule and annual RMDs would cease until year 10. He must complete the year of death RMD of his wife if she passed in 2021. If these dates do not apply, please provide update.

Submitted by James Biasotti on Mon, 2021-06-28 15:19

Those dates would be accurate- thanks for the clarification. 

Submitted by James Biasotti on Mon, 2021-06-28 15:20

Those dates are accurate- thanks for the clarifcation

Submitted by James Biasotti on Mon, 2021-06-28 17:29

Also how would you retitle account? Beneficary IRA in his name?  

Submitted by Alan - IRA critic on Mon, 2021-06-28 18:37

Each custodian has their own method of titling inherited IRAs, and it is very unlikely that the IRS has issues with any of them. The most preferred method in this situation is for the title to show (client name) as beneficiary of wife’s name. Name of original plan owner (father) can be dropped.

Submitted by James Biasotti on Mon, 2021-06-28 23:08

Thank you!!

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