A:

If your brother cannot be found, you may want to check with the IRA custodian and/or the financial advisor to find out if the IRA plan document includes any provisions for such a situation. For instance, some IRA documents state that if a beneficiary cannot be found, that beneficiary will be treated as if he/she is not a beneficiary of the IRA. If the IRA you inherited includes such a provision, you may be treated as the sole primary beneficiary - provided reasonable efforts are made to locate your brother.

Generally, the required minimum distribution (RMD) for the year of death should be distributed by all the primary beneficiaries on a pro-rata basis. In your case, your brother would withdraw 50% from his share and you would withdraw 50% from your share, assuming that you are supposed to receive 50% each. If he cannot be found, it may make sense for you to withdraw the full RMD amount, especially if it's possible that his share of the assets will go to you. This will help to ensure that the 50% excess accumulation tax does not apply to any amount.

To learn more about IRA distribution, check out Who Is The Beneficiary Of Your Account?, Inherited Retirement Plan Assets - Part 1, Inherited Retirement Plan Assets - Part 2 and Disclaiming Inherited Plan Assets.

This question was answered by Denise Appleby
(Contact Denise)

RELATED FAQS
  1. Can the non-spouse beneficiary of an IRA name a successor beneficiary?

    Whether the beneficiary of an individual retirement account (IRA) can name a successor beneficiary (second generation beneficiary) ... Read Answer >>
  2. Upon my death, will the beneficiaries of my IRA be compelled to take the entire amount ...

    It depends. If the beneficiary of your IRA is your spouse, he or she will be eligible to transfer the amount to his or her ... Read Answer >>
  3. How do I transfer my 401k funds to my family?

    I was a business owner and retired in 2015. My 401k is still active. I'm 55 years old, but have terminal cancer. The money ... Read Answer >>
  4. Why do I need to turn my inherited IRA over to the estate?

    My mother had an IRA and named me as the beneficiary. I am now being told, from the executor of her will, that I need ... Read Answer >>
  5. If a trust is named as the beneficiary of an IRA, can the trustee of that trust become ...

    While the IRA owner is alive, only the IRA owner can change the designated beneficiary of the IRA. Exceptions may apply if ... Read Answer >>
  6. My spouse is the primary beneficiary of my IRA. I also have a contingent beneficiary. ...

    A spouse who is the sole primary beneficiary of an IRA can always treat the IRA as his or her own. The contingent beneficiary ... Read Answer >>
Related Articles
  1. Retirement

    Inherited IRA and 401(k) Rules: Don't Run Afoul

    What you need to know when it comes to the complex rules for inherited IRAs and 401(k)s.
  2. Financial Advisor

    Top Estate Planning Tips for 401(k)s and IRAs

    Here's how to avoid estate planning pitfalls when it comes to leaving IRA and 401(k) assets to heirs.
  3. Managing Wealth

    Trusts: Prevent Beneficiary Designation Mishaps

    Wills and revocable trusts are the cornerstone of estate planning, learn how you may spend considerable time and money maintaining these documents.
  4. Retirement

    Mistakes In Designating A Retirement Beneficiary

    Make sure your beneficiary designations not only reflect your intentions but also meet the requirements to be effective.
  5. Retirement

    Designating A Trust As Retirement Beneficiary

    Designating a trust as your IRA beneficiary can be beneficial, but it requires proper planning to avoid problems.
  6. Financial Advisor

    Why Your Will Should Name Designated Beneficiaries

    Find out how to make the tough decisions when it comes to choosing who will receive your assets and how they will be paid out.
  7. Retirement

    11 Things You May Not Know About Your IRA

    These little-known features will help you get the most out of your retirement savings.
  8. Retirement

    Want To Leave Money To Your Family? Stretch Your IRA

    Find out how your beneficiaries can enjoy tax-deferred growth for as long as possible.
  9. Financial Advisor

    How to Handle Client Beneficiary Designations

    Beneficiary designations are a critical financial planning step that can be easily overlooked. Here's how to ensure they are properly done.
  10. Financial Advisor

    An Estate Planning Must: Update Your Beneficiaries

    Life changes make it time to rewrite your plan's designations.
RELATED TERMS
  1. Extended IRA

    An IRA that allows a second generation beneficiary to continue ...
  2. Inherited IRA

    An individual retirement account that is left to a beneficiary ...
  3. Stretch IRA

    An estate planning concept that is applied to extend the financial ...
  4. Beneficiary

    Anybody who gains an advantage and/or profits from something. ...
  5. Secondary Beneficiary

    A person or entity that inherits assets under a will, trust or ...
  6. Primary Beneficiary

    A beneficiary in a will, trust or insurance policy that is first ...
Hot Definitions
  1. Quantitative Trading

    Trading strategies based on quantitative analysis which rely on mathematical computations and number crunching to identify ...
  2. Bond Ladder

    A portfolio of fixed-income securities in which each security has a significantly different maturity date. The purpose of ...
  3. Duration

    A measure of the sensitivity of the price (the value of principal) of a fixed-income investment to a change in interest rates. ...
  4. Dove

    An economic policy advisor who promotes monetary policies that involve the maintenance of low interest rates, believing that ...
  5. Cyclical Stock

    An equity security whose price is affected by ups and downs in the overall economy. Cyclical stocks typically relate to companies ...
  6. Front Running

    The unethical practice of a broker trading an equity based on information from the analyst department before his or her clients ...
Trading Center