How Would My Surviving Spouse Beneficiary Retitle an Inherited IRA?

By Joe Cicchinelli and Beverly DeVeny
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This week’s Slott Report Mailbag looks at how a QDRO (qualified domestic relations order) works with 401(k) withdrawals and details the IRA beneficiary process. As always, we recommend you work with a competent, educated financial advisor to keep your retirement nest egg safe and secure. You can find one in your area here.


After a QDRO (qualified domestic relations order) 401(k) split involving a 35 year old, for how long can a person under 35 withdraw from the 401(k) penalty free?


All QDRO distributions from a 401(k) plan are exempt from the IRS 10% early distribution penalty. Distributions from the plan must be made in accordance with the rules for that plan. The plan could allow for frequent withdrawals, no withdrawals until the employee has a triggering event, or only one withdrawal of the entire QDRO amount. If the individual rolls some or all of the QDRO distribution to an IRA, the QDRO exception to the 10% penalty doesn’t apply to any IRA distributions.



My wife and I are 74 years old and take RMDs (required minimum distributions) from our IRAs and have selected each other as beneficiaries and our son as secondary.

The first one dies, the second will inherit the surviving spouse’s IRA.

The survivor has to “retitle’ the IRA something like John Jones IRA (deceased Aug 1 2014) for the benefit of Joan Jones, beneficiary


  1. Is the above correct?
  2. How is the new RMD calculated?
  3. When does the survivor have to take the “new” additional distribution?
  4. Does the surviving spouse have to change the secondary beneficiary into the primary and designate a new secondary?



1. The titling of an inherited IRA after owner dies must include both the name of the deceased IRA owner and the beneficiary. Your example above is one of many ways to correctly title an inherited IRA.
Your wife would most likely be better off moving the funds to an IRA in her own name. She would then own the IRA and would not be a beneficiary. The funds could be moved into her existing IRA.

2. When you die after your required beginning date, in this example, the RMD for your wife (the beneficiary) is calculated using your wife’s single life expectancy starting the year after you die (stretch IRA). However, if she does a spousal rollover to her own IRA, her RMD will be calculated using the Uniform Lifetime Table, in the same manner she uses for her own IRA.

3. The death distribution (stretch IRA) starts the year after your death if she remains a beneficiary. In the year of death, she must take any undistributed RMD you didn’t take before you died.

4. Yes. Once a beneficiary inherits an account, any contingent beneficiary named by the original account owner no longer has any interest in the IRA. Your wife should immediately name a new primary and contingent beneficiary of the IRA, whether it is an inherited IRA or a new account in her own name.


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