inherited an inherited IRA
I have a client whose wife died recently. His wife had a beneficiary IRA from her Mom that she was taking stretch RMDs on. Now that my client’s wife is deceased and he inherits the beneficiary IRA, does the new RMD rules apply or can he continue the stretch IRA? If he can maintain the old stretch status are RMDs now based on his life expectancy?
Permalink Submitted by Alan - IRA critic on Wed, 2021-07-21 22:22
He cannot use his own life expectancy, as he is a successor beneficiary. He also cannot roll it over to his own IRA. But his RMD requirements depend on WHEN Mom (original IRA owner) died.
Since his wife was taking annual RMDs (not the 10 year rule), that means that Mom passed prior to 2020. Client is successor beneficiary to his wife, and will be subject to the 10 year rule, meaning no annual RMDs for him, but the entire balance must be drained by 12/31/2031.