Inherited IRA from elderly mother
My wife will soon inherit an IRA from her mother who died at age 93. My MIL inherited an IRA from her son (my wife’s younger brother) in 2019 under the old “stretch IRA” rule (he died in December, 2019). At that time her life expectancy was, I think, 5.9 years. She has not taken any distributions from the IRA. Will my wife be able to stretch the IRA over her lifetime or will we have to deplete it in 10 years? Thanks for any help.
Permalink Submitted by Alan - IRA critic on Mon, 2024-06-03 23:40
Mother should have been taking LE RMDs, but if she did not and then passes in 2024, your wife will only be responsible for the 2024 beneficiary RMD for 2024, but that RMD will be a high % of the inherited IRA balance. While your wife will get a new 10 year rule, the IRA will not last nearly that long because your wife will have to continue the RMD schedule her mother would have used with annual 1.0 divisor reductions, and that will result in the IRA being drained in a couple years. Your wife’s age is immaterial as a successor beneficiary.