Which Inherited IRA distribution rules apply…?
Husband died in 2018, after his RBD. His wife, suffering from dementia, never filed a beneficiary claim to transfer the IRA into her name. Wife died in 2022. Wife’s executor has contacted IRA custodian, and they are in the process of rolling the IRA into an Inherited IRA for the benefit of the Wife’s Estate.
I’m having trouble wrapping my head around which distribution rules to apply. Thanks,
Permalink Submitted by Alan - IRA critic on Thu, 2023-06-22 18:14
Since wife never took a beneficiary RMD, she defaulted to ownership status on 1/1/2020. As the owner, in 2022 she either passed prior to or after her RBD. If prior, the 5 year rule applies to the estate. If after, her remaining LE applies. If the executor is able to assign the inherited IRA out of her estate to the estate beneficiaries, they are also bound by the above rules that apply to the estate. The estate or it’s beneficiaries were also responible for completing wife’s 2022 year of death RMD if she passed after her RBD.