Inherited – inherited spouse 457(b) from mother.
My mother age 86 recent died. She had inherited a 457(b) from my father who died at age 75. I and my 3 sisters are the beneficiaries of the account. I am age 60. What are my withdrawal options?
My mother age 86 recent died. She had inherited a 457(b) from my father who died at age 75. I and my 3 sisters are the beneficiaries of the account. I am age 60. What are my withdrawal options?
Permalink Submitted by Alan - IRA critic on Sun, 2024-06-30 15:46
Sorry to hear of your loss.
Assuming this is a govt 457b plan, it is surprising that mother did not roll it over to her own IRA as her RMDs would have been much lower than continuing the plan as a beneficiary, and in addition you are now successor beneficiaries rather than designated beneficiaries, as you would have been had she rolled this over to an owner IRA.
If the 457b does not require a lump sum distribution as many do, the IRS rules require you as a successor beneficiary to continue the RMD schedule mother was using and if the inherited plan is not drained sooner than 10 years, it will have to be drained no later than 12/31/2034. As successor beneficiaries, none of your ages matter since mother’s RMD schedule must be continued.
Also, it will not be possible for any of you to do a direct rollover to an inherited IRA, again because you are successor beneficiaries. Hopefully, the plan will not simply make a total distribution to each of you, but if I had to make a guess, they probably will.