RMD and Inherited IRA
I inherited an IRA from my mother 4 years ago. I have been taking my RMD. I am below the RMD age for the rest of my IRAs. When I turn 73 in 2 years, I know my RMD is calculated on the composite of all of my IRAs. I was wondering if the balance of my inherited IRA is included in the aggregate of my non inherited IRAs?
Permalink Submitted by Alan - IRA critic on Sun, 2023-11-05 18:57
RMDs for owned IRAs and inherited IRAs cannot be aggregated. Therefore, you will have to continue the RMD schedule for your pre Secure Act inherited IRA, and the divisors should have been reset last year to reflect the new RMD tables. When you reach RMD age for your owned IRAs, you can aggregate the RMD distribution between other owned IRAs but not with the inherited IRA. Your own IRAs will be subject to the Uniform Table, which produces a lower RMD per dollar of balance than an inherited IRA RMD, and the RMD calculations for your own IRAs and inherited IRA must be calculated entirely separately (different divisors and different prior year end account balances) and distributed separately between your owned IRAs and the inherited IRA.
Permalink Submitted by Kelly Keltner on Wed, 2023-11-08 23:17
A 90 year old man passed away on 1/12/2020, leaving his IRA to his 58 year old son. The son said his RMD distributions were waived in 2021 and 2022. I know the 2021 distribution was waived due to COVID-19, but was the 2022 distribution waived as well? What about the 2023 contribution; is he required to take one for 2023? Thank you.
Permalink Submitted by Alan - IRA critic on Wed, 2023-11-08 23:42
The 2020 RMD year of death was waived by the CARES Act, so the son would not have any year of death RMD to be concerned with. And his beneficiary RMDs for 2021-2023 have also been waived by the IRS due to the failure of the IRS to finalize the Secure Act Regs. If they become final in 2024, a beneficiary RMD will likely be required for 2024. However, the more years that pass with no distribution being taken, the larger the amount of distributions will be before the 10 year rule requires a total distribution in 2030.
Permalink Submitted by Kelly Keltner on Thu, 2023-11-09 18:09
Are all beneficiary RMD’s waived for 2023 even if the nonspouse inherited prior to 2020? Thank you.
Permalink Submitted by Alan - IRA critic on Thu, 2023-11-09 18:28
No. Only the annual RMDs subject to the Secure Act 10 year rule for deaths after 2019 are waived for 2021-2023. Annual beneficiary RMDs for accounts inherited prior to 2020 must be continued, except for the 2020 RMD.