Inherited IRA – Insurance company requiring yearly distribuitons
Client inherited IRA from deceased spouse in 2016. It was not rolled over to his IRA because he was 50 years old and there was a chance he would tap into the money before he was 59 1/2. So, we opened an Inherited IRA for him.
We did a direct transfer to an annuity ( fixed indexed annuity) for protections. Money is still in an IRA.
Now, Lincoln is require my client take mandatory RMDs from this account.
My client is 56 years old and deceased wife died at age of 56 in the year 2016.
Question: Is it correct that Annuity( insurance company) is asking for a mandatory yearly distribution? My previous custodian , Pershing never requested a yearly distribution.
Is this request unique to insurance companies?
So confused.
Permalink Submitted by Alan - IRA critic on Mon, 2021-11-01 21:10
Lincoln appears to be overlooking the fact that for a sole surviving spouse beneficiary RMDs do not begin until the year the deceased spouse would have reached 70.5/72. In this case, it would be 72 so there are several remaining years with no beneficiary RMDs required. Pershing was correct and the Secure Act had no effect on this rule. Hopefully, upon checking the company will back off. Citation: Sec 401(a)(9)(B)(iv).