trust as beneficiary
a deceased client named living trust as beneficiary for his IRA. He was 75 and taking RMD’s. The account was moved to an inherited IRA under the trust. Can the distributions for beneficiaries be taken from the trust or should an inherited IRA be established for each beneficiary so they can use their life expectancy over the 10 years. thanks.
Permalink Submitted by Alan - IRA critic on Fri, 2023-08-25 15:39
The RMDs in years 1-9 must be based on the age of the oldest trust beneficiary if this is an accumulation (not a conduit) trust, and it meets all the requirements for look through qualification. If not qualified, the RMDs are based on the remaining LE of the decedent, which is actually longer than 10 years. And if the trust provisions allow the distribution of inherited IRAs out of the trust by the trustee, that will not change the RMD calculation. It will just result in the trust beneficiaries having their own inherited IRAs to manage.