estate named as beneficiary

Submitted by Michael Handzo on Thu, 2023-09-07 18:10

a husband passed away and his IRA beneficiary is his estate, he was 86, his wife is still alive and she’s 84, the IRA is worth $300k, is there anyway for her to rollover/transfer to an IRA in her name even though the estate is the bennie?



Submitted by Alan - IRA critic on Thu, 2023-09-07 19:22

  • What does his will show as the beneficiary? If wife is the sole will beneficiary and the executor of his estate, she may be able to do the spousal rollover to her own IRA if her IRA Custodian will do it without requiring her to apply for a private letter ruling. While the IRS would likely approve it, these PLRs cost at least 20k and take time.
  • If not, the executor may be able to assign the IRA out of the estate to a beneficiary IRA (not an owned IRA) for her, and she will have around 7 years to drain the inherited IRA. If she was able to roll to her own IRA, it would last much longer the rest of her life with  a large portion remaining if she did not need to withdraw more than her RMD.
  • If husband did not complete his year of death RMD, the estate is responsible for completing it.

Submitted by Michael Handzo on Fri, 2023-09-08 15:50

wife is beneficairy in will and there are co-executors, the wife and the attorney.

Submitted by Alan - IRA critic on Fri, 2023-09-08 18:41

There have been several PLRs over the last 3 decades allowing the spousal rollover in a case like this, and p 22 of the 2002 RMD Regs seem to allow a spousal rollover. One of the executors needs to take this up with the IRA Custodian to determine what method the custodian will allow. For example, if the executors assign the inherited IRA out of the estate to the surviving spouse will beneficiary, will the custodian then accept an election to assume ownership of the inherited IRA, or will the surviving spouse have to take a distribution as beneficiary and roll over that distribution to the extent that it exceeds the beneficiary RMD for the year and the decedent’s RMD if decedent did not complete it.

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