Minor Age 14 Beneficiary of Mother’s Roth IRA RMD
Looking to clarify the RMD options for a minor inheriting their mother’s Roth IRA. Mother passed in 2024, minor will be age 15 in 2025 making his RMD factor 69.9 in 2025.
While the minor is under 21, RMDs (Required Minimum Distribution) are calculated based on the child’s life expectancy using the single life table(2025 factor of 69.9), subtracting one each year. Then when the child reaches age 21, the 10-year rule will kick in allowing another 10 year period of RMD’s. By electing this route it will give this minor basically 16 years of deferral but with RMD’s required, the other option is not to elect EDB status and be subject to 10 year rule but no RMD’s required. Am I missing or misunderstanding these options?
I was recently made aware at a conference the updated regs thou not clear may allow a full time student to defer past age 21 then add the 10 years to that age. Any truth to this comment?
Permalink Submitted by Alan - IRA critic on Thu, 2025-02-13 15:41
No, age 21 is the year in which the 10 year rule kicks in for minor RMDs. There are no variances for students v non students. And as you suggested, the annual beneficiary RMDs started as an EDB must continue to age 31 even though the 10 year rule kicks in at 21 and the deceased parent passed prior to RBD.
Death of parent would result in the inherited Roth being qualified after the 5th year of parent’s first Roth contribution, so if not already qualified, it will be at some point while the beneficiary is still a minor. Meanwhile the RMDs will be so small that no taxes should be due before the inherited Roth IRA is qualified. That will avoid possible kiddie tax issues.