Retirement Plan Beneficiary
Retirement plan is in a trust for widow. She is the only beneficiary. Should she use the single life annuity computation for the RMD or the Uniform Distribution Table?
It looks like the money stayed in the 401(k) plan for several years after death. When death occurred, 2 accounts were set up. A inherited 401(k) account in the name of the trust and a inherited 401(k) account in the name of the widow individually. Several years later, the funds were eventually rolled over to an IRA in the name of the widow and an inherited IRA in the name of the trust. Would it have been possible to perform a spousal rollover to both account years later?
Permalink Submitted by Alan - IRA critic on Wed, 2024-02-07 21:53
The Uniform Table will only apply if the widow can accomplish a spousal rollover to her own IRA, and there are hurdles to accomplish that. If the IRA remains in the trust, she must use the single life table. If she is the sole beneficiary of the trust, the trustee can “recalculate” the annual RMD divisor, which involves entering the single life table each year for a new divisor. If not the sole beneficiary, the trustee must reduce the original divisor by 1.0 each year.