Inherited IRA 10-year period RMDs
Hi, hope all is well. Need clarification on the 10-year period and RMD requirements. From my understanding, if the decedent was taking RMDs then the non-eligible designated beneficiary generally needs to take RMDs in years 1-9 and the account must be liquidated within the 10 years.
If the decedent was under RMD age (73) and not taking RMDs, then the Non EDB doesn’t need to take RMDs in years 1-9 but the account must be liquidated within the 10 years.
What happens if the decedent dies at age 70? Does the Non EDB need to take RMDs in year 3-9 during the 10-year payout period?
Please advise. Thanks! Walter
Permalink Submitted by Alan - IRA critic on Wed, 2025-03-19 11:02
That’s generally correct, but technically these rules apply based on the decedent’s RBD, so if the decedent took an RMD in the year prior to the RBD year and also passed prior to the RBD, he is treated as passing prior to RBD (which he did) despite the fact that he had started RMDs the year before.
If the decedent passed prior to RBD, the beneficiary does not have to take annual RMDs in years 1-9. But if this is not a Roth IRA, the beneficiary might want to take roughly equal voluntary distributions each year to avoid a large total distribution in year 10 which could increase his marginal rate that year.
Permalink Submitted by Walter Gonzalez on Wed, 2025-03-19 22:54
Appreciate the information. Thanks! Walter