First to Die
Help my confusion….
What rules govern First to Die when the account holder dies, followed by the primary beneficiary 4 days later, before she had time to sign paperwork. I understand now that the IRA and ROTH will go to Estate IRA and ROTH accounts but are the rules, tax rules or legal?
Permalink Submitted by Alan - IRA critic on Wed, 2025-08-27 13:46
The estate of the primary beneficiary will inherit the accounts unless the executor of the estate files a disclaimer, in which case the accounts will go to any contingent beneficiary named by the owner, and if none to the estate of the owner.
But the RMD rules vary and are dependent on the specific situation. Are you referring to an owner that passed after RBD, and is the beneficiary the spouse or a non spouse?
Permalink Submitted by Stuart Cameron on Wed, 2025-08-27 14:55
Sorry Alan, you replied before. The owner passed after RBD and the primary beneficiary was his spouse who died 4 days later, before changing beneficiaries.
The Estate Attorney has asking to see the IRA Information and where it states that First to Die is activated. The IRA does not mention first to die in the supplemental information. I wondered if this was an IRS item more than a legal question.
Permalink Submitted by Alan - IRA critic on Wed, 2025-08-27 16:02
I reviewed the former thread which had the underlying details. I think that the disposition of the IRAs that the wife owned all along is clear, and this question only involves the inherited IRA from the husband. However, you posted a question to that thread on 8/13 that I did not see until now.
For the wife’s IRA, there were contingent beneficiaries who inherited directly and therefore not part of the probate estate. Separate inherited TIRA and inherited Roth IRA can be opened for those contingent beneficiaries. If they are not EDBs, the 10 year rule applies for those inherited IRAs, with annual RMDs due from the inherited TIRA, but no annual RMDs due for the inherited Roth before year 10.
The estate attorney is therefore probably asking about husband’s IRA that has now been inherited by wife’s estate. Because the wife inherited it before passing, the contingents are erased unless her estate files a disclaimer on her behalf. If that was done, his IRA would bypass her estate and go directly to the contingents.
Without the disclaimer, his IRA went to her and then to her estate, which is the successor beneficiary. The executor may be able to assign the inherited IRAs out of the estate to the estate beneficiaries so the estate can be closed without having to stay open to receive the RMDs. Did she have a will? Does the “first to die” question relate to the disclaimer or to a different issue?
Permalink Submitted by Stuart Cameron on Wed, 2025-08-27 16:47
This is the part that confuses me, the Estate Attorney (from a large Philadelphia firm) is asking me where the First to Die time [period comes from? Is it an IRS ruling or one of legal standing. Not sure why he is asking us.
Permalink Submitted by Alan - IRA critic on Wed, 2025-08-27 17:33
OK, the question then probably relates to the Uniform Probate code in husband’s state and how it incorporates the Uniform Simultaneous Death Act when deaths are close together, usually within 120 hours of each other. If the actual times of death are uncertain, this Act allows both of them to be treated as pre deceasing the other and would eliminate having assets subject to two probates. Not sure if this applies when the actual times of both deaths are clear.
Her own IRA is not subject to probate, just his, although there could be other assets in addition to the IRAs. This is a legal question that should be resolved with the IRA custodians. If she could be treated as pre deceasing him, then his contingent beneficiaries would inherit directly, and his IRA would not be subject to probate as it would pass outside of her estate. That would also eliminate the need to consider a disclaimer.
Permalink Submitted by Stuart Cameron on Thu, 2025-08-28 12:51
Alan, first to die was on 08/08/25 at 4:19 am, his wife died on08/12/25 at 3:54 am.
Permalink Submitted by Alan - IRA critic on Thu, 2025-08-28 13:13
Since she passed less than 120 hours after him, I think the attorney might be thinking that the Simultaneous Death Act could be brought into play and each spouse might be able to be treated as pre deceasing the other spouse. While that would be a definite advantage with respect to HIS IRA going to his contingent beneficiaries, I have my doubts that the Act could be applied here.
This is a legal question, and the estate attorney is in the best position to investigate it. It is also highly unlikely that the IRA agreement would contain specific provisions that override the legal question.
Permalink Submitted by Stuart Cameron on Thu, 2025-08-28 14:54
Thanks Alan. Very helpful.