Inherited IRAs and Roth IRA Rollovers: Today’s Slott Report Mailbag

Friday, December 04, 2020

By Andy Ives, CFP®, AIF®
IRA Analyst
Follow Us on Twitter: @theslottreport

Question:

My father passed away in 2019 and left me an IRA. Will the SECURE Act apply, or will it be grandfathered under the pre-2020 rules?

Thank you.

Aram

Answer:

Aram,

Since your father passed away in 2019, we will default to the old pre-SECURE Act rules. You are permitted to set up an inherited IRA and stretch payments over your own life expectancy if you choose to do so. Normally, your first RMD would have been due this year – 2020. However, the CARES Act waived 2020 RMDs, even for inherited IRAs. As such, RMDs will not start for you until 2021. (Just be sure to get the inherited IRA set up before the end of this year.)

Question:

Hello Ed,

I have a Roth IRA with a custodian and a Roth 401(k) that is in a bank account with myself as trustee. I am self-employed, 65 years of age, and have had both accounts open over 5 years.  Can I move the self-directed Roth IRA funds (with a custodian) over to my Roth 401(k) account tax free? I can’t find anything online that addresses this transfer.

Much appreciated,

Karyn

Answer:

Karyn,

Roth IRAs cannot be rolled over to a Roth 401(k).

*This answer was corrected from a previous version of this Slott Report Mailbag 

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