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Discussion Posts

    • Beneficiary to a Beneficiary IRA

      • Posted by: MDS
      •  on  May 6, 2008 9:03 AM EDT

      I have been dealing with the following scenario and can't find any definitive answers.  Any thoughts or ideas to point me in the right direction would be greatly appreciated.

      The owner of an IRA dies and passes the IRA to a non-spouse beneficiary.  The non-spouse beneficiary has been taking annual RMD's to stretch the Beneficiary IRA.  Unfortunately, the non-spouse beneficiary recently passes and her spouse now receives the Beneficiary IRA.  It is now a Beneficiary to a Beneficiary IRA. 

      For example, Great Aunt passes down IRA to a niece.  The niece passes and her spouse becomes the IRA holder.

      Can the Beneficiary to a Beneficiary IRA stretch the RMD's through his life?  How is the RMD calculated?  It is based on the life expectancy of the Beneficiary to a Beneficiary IRA.

      In theory, can these beneficiary IRAs be passed on forever or at some point, do they have to be distributed?

      My apologies if this is in the wrong thread.  Thanks in advance!

       
    • Re: Beneficiary to a Beneficiary IRA
      • Posted by: Biancaniello, Turmel
      •  on  May 15, 2008 5:59 PM EDT
      I got this from Ed Slotts website: http://www.irahelp.com/ as I couldn't find anything on the irs pub 590 that referenced it.    This is what I initially thought as well -from what I understand the rmd is based on if the original owner was already taking his/her rmds.  If they were, you need to take the rmd based on their age.  If they weren't, you take the rmds based on the beneficiary's age.   
      Good luck.  Deborah

      mhassett
      Joined: 01 Jan 1970
      Posts: 9


      Heres the 2 part question. DAD who passed leaves IRA for daughter. We dont know if daughter titles the non spousal inherited IRA properly. But if she did and in this case she passed, can the husband inherit the non spousal inherited IRA from deceased wife and if so how does he title the new inherited IRA?

      Any help would certainly be appredciated....Michael



      alan-oniras
      Joined: 01 Jan 1970
      Posts: 1252
      Location: Prescott, AZ


      If daughter names her husband as her successor beneficiary on the non spouse inherited IRA, he cannot make the IRA his own upon her passing, but can continue to take RMDs based on the non recalculated schedule his wife was using, and add his name as successor beneficiary. He also should name his own successor beneficiary.

      He would title as follows:
      John Smith, as beneficiary of Susan Smith, beneficiary of Donald Jones, deceased xx/xx/xxxx.

      There is not a rigid format requirement, so it may be necessary to adjust the above somewhat to comply with the IRA custodian's support system requirements. The original account owner must continue to be identified, however