Inherited IRA 10-year rule
If a deceased IRA owner was 80 for example and already taking RMDs, as of today the child beneficiary (age 30) still wouldn’t need to take a small RMD each year? Because if they would then I would need to find out the age of the deceased and then know the life expectancy table to figure out that RMD?
Permalink Submitted by Alan - IRA critic on Thu, 2022-10-06 17:45
The proposed Regs would require annual RMDs for the child, but they are not yet final, and this requirement is being contested. If the child wants to avoid a large tax bill in year 10 of the 10 year rule, computing the beneficiary RMD would help level the income over the 10 years. Beneficiary RMDs would be based on the child’s attained age in the year following owner’s death. Owner’s age does not matter other than determining if they passed after their RBD or not because that determines whether child will need to take annual RMDs in years 1-9. If owner passed after RBD, child is also responsible to complete owners’s year of death RMD.