sPOUSE Inherits Roth IRA
Would you please remind rules regarding inherited Roths by spouse. can the spouse transfer the interited roth into their own name, assuming the decedent had the roth for five years? any other issues to consider about consolidating the inherited roth into the survivor’s roth.
Permalink Submitted by Alan - IRA critic on Wed, 2023-12-06 18:09
The surviving spouse can assume ownership at any time. When that is done, the longer of the holding period for either spouse determines if the 5 year holding period has been met, but the age requirement (59.5) for the Roth to be qualified is the age of the surviving spouse. If the surviving spouse is younger than 59.5, they may wish to maintain a beneficiary Roth until they reach 59.5 to avoid any penalty on any distributions. When held as beneficiary, RMDs must begin in the year the deceased spouse would have reached RMD age. Therefore, thed age of both spouses is a factor in making the decision when to assume ownership.
Permalink Submitted by John Boyle on Thu, 2023-12-07 03:03
Would there be RMDs on a beneficiary ROTH account?
Permalink Submitted by Alan - IRA critic on Thu, 2023-12-07 03:56
Yes, unless the surviving spouse was the beneficiary and elected to assume ownership. Other than the year of death, when the surviving spouse assumes ownership they are treated as owning the Roth for the entire year and that would erase any beneficiary RMD due for that year.