Spousal Rollover
Our office received a call from an individual who’s husband ( 07/05/1963 ) passed away on October 12, 2020. He had a Penn State DCP valued at $ 250,000.00. To date, the caller ( 02/13/1959 ) has done nothing to address the Deferred Comp Plan.
Why am I thinking that something need to be done by 12/31/2021? Will she be penalized for her delay in this matter? Can the account just be “Rolled Over” to her existing IRA without issue?
Thank you…as always
Permalink Submitted by Alan - IRA critic on Thu, 2022-08-11 13:25
There were no beneficiary RMDs due until spouse would have reached 72. And since she is now over 59.5 she can take any distributions she needs from the IRA without penalty. If there was some reason that she wanted to delay RMDs beyond the year she reaches 72, because he was 4 years younger she could roll it to an inherited IRA with no beneficiary RMDs needed until she was 76 (he would have reached 72), then she could elect to assume ownership of the inherited IRA in that year and use the Uniform Table. It would be simpler for her to roll it over to her own IRA and not have to worry about it later in most cases as she still has 9 years before any RMDs are needed.