Urgent help needed with Inherited IRA RMD
My client is 66 in 2025, and inherited an IRA from her mom who passed away at the end of 2024 at the age of 89. Based on the post-2020 rules, I would use the beneficiary’s age in the year after her mom’s passing (66) and lookup the single life expectancy table to find the factor of 27.1 which would then be used to calculate the RMD in year 1, and decreased -1 each year for the remaining 9 years. IS THIS CORRECT?
BECAUSE, I have run this through 2 separate online calculators (Schwab and Fidelity) and they keep telling me the correct factor is 22?? I have no idea where this is coming from, or if there was some new rule that limits the life expectancy factor?
Please help!!
Permalink Submitted by Alan - IRA critic on Thu, 2025-04-17 17:15
22.0. is the correct RMD divisor for 2025. It is based on the attained age of 66 for the client in 2025 and comes directly from the IRS single life table. 27.1 is the divisor for age 60, so I think you simply arrived at the 27.1 divisor by looking at the wrong age in the table.
The 22.0 is then reduced by 1.0 for each successive year, and the 10 year rule applies which will require the inherited IRA to be drained by the end of 2034. Taking out just the amount of the RMD will still result in a large distribution in the final year, so client may want to take out more than the RMD to equalize the taxable income.
Note that if mother did not complete her 2024 RMD before passing, client is also responsible for completing the year of death RMD.