Bene IRA to Owner IRA

Submitted by Sarah Murphy on Mon, 2022-11-21 15:10

Hi – Client had three bene IRA accounts that we combined into one Trad IRA of her own during this year. As of 12/31/21, the accounts were in the bene IRA registration – is she subject to an RMD since the value was in the bene IRAs as of end of last year? She inherited the accounts originally in 2017. Thank you.



Submitted by Alan - IRA critic on Mon, 2022-11-21 15:31

She can roll over an inherited IRA from her spouse, but not if she is a non spouse beneficiary. Who did she inherit these IRAs from?



Submitted by Sarah Murphy on Mon, 2022-11-21 16:54

Yes, they were from her spouse. 



Submitted by Alan - IRA critic on Mon, 2022-11-21 17:09

  • If the “rollovers” were actually done by non reportable direct transfers to avoid the one 60 day rollover limitation, she is treated as owning the IRA for the entire year. 2022 RMDs would be calculated from the Uniform Table using the 12/31/2021 balances. 
  • However, if there was an actual distribution from the inherited IRAs, and they were subject to RMDs, only the amount in excess of the RMD could be rolled over to her own IRA. She may or may not have been subject to beneficiary RMDs depending on whether she was the sole beneficiary, and whether spouse passed prior to or after their required beginning date. Had she been taking annual beneficiary RMDs since 2018?


Submitted by Sarah Murphy on Mon, 2022-11-21 18:39

The rollovers were done as direct transfers from Bene IRA to her IRA account.     She did take RMDs each year from the Bene IRA accounts since 2017 – first year of dist. 



Submitted by Sarah Murphy on Fri, 2022-12-09 18:55

Hi – Owner is now 69; she did not take Inherited IRA RMDs 2018, 2019, 2021 – we are now taking and correcting.  Now that the funds (as of  Oct 2022) are out of the Inherited IRA accounts and into her Own Traditional IRA and since she is only 69 years old, an RMD for 2022 would NOT be required even though the Inherited IRA accounts had value as of 12/31/2021?  Thank you. 



Submitted by Alan - IRA critic on Fri, 2022-12-09 20:01

If spouse passed prior to 70.5 the sole surviving spouse would not have had to take a beneficiary RMD until the year her husband would have reached 70.5. However, starting with the first year that she was required to take a beneficiary RMD and did not complete it, she would have defaulted to ownership status that year and since she is not yet RMD age, there would be no RMD required. Therefore, there is no need for these current distributions and if already distributed as a single distribution, it could be rolled back.



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