If an IRA owner dies after starting required minimum distributions (RMD) but the spouse is under 70.5, can the spouse roll over the IRA into his/her own IRA, and stop RMDs until age 70.5?

By Denise Appleby AAA
A:

If the IRA owner dies after the required beginning date (RBD) and his/her beneficiary is his/her spouse, the spouse beneficiary may either:

  1. Begin death distributions by Dec 31 of the year following the year the IRA owner dies. In this case, the distributions must be calculated using the longer of the deceased's remaining life expectancy or the spouse's life expectancy. If the surviving spouse's life expectancy is being used, it must be determined on a recalculated basis. In other words, the tables must be visited each year to determine the factor, a life expectancy figure found in the IRS life expectancy tables. If the deceased's life expectancy is being used, it must be determined on a non-recalculated basis or in the year of death, subtracting one from the factor for each subsequent year.
  2. Treat the IRA has his/her own and do not begin required minimum distribution (RMD) amounts until he/she reaches her RBD.

The spouse beneficiary options apply only if the spouse is the sole primary beneficiary of the IRA. If the spouse is one of several primary beneficiaries, then he/she may be subject to the non-spouse beneficiary options should he/she choose to keep the assets in an inherited IRA. However, he/she may distribute and roll over his/her portion of the assets to his/her own IRA and need not begin distributions until his/her RBD.

(For more on RMDs, check out Avoiding RMD Pitfalls, IRS Modifies Separate Accounting Rules as well as Inherited Retirement Plan Assets – Part 1 and Inherited Retirement Plan Assets – Part 2.)

This question was answered by Denise Appleby
(Contact Denise)

RELATED FAQS

  1. Can I purchase mutual funds for my IRA?

    Learn how to invest your IRA assets in mutual funds. Discover a few of the different types of mutual funds available for ...
  2. What is the minimum amount of money that I can invest in a mutual fund?

    Learn about investing in mutual funds even with a smaller initial investment; there are many funds available to investors ...
  3. Can I purchase mutual funds for my IRA?

    Learn how to invest your IRA assets in mutual funds. Discover a few of the different types of mutual funds available for ...
  4. What are the best ways to plan for retirement?

    Learn the basic steps to creating a solid retirement plan that can support you and your family, and find out how to manage ...
RELATED TERMS
  1. Elder Care

    Elder care, sometimes called elderly care, refers to services ...
  2. Gold IRA

    Definition of Gold IRA
  3. Eligible Transfer

    An IRS-allowed movement of assets into or out of an individual ...
  4. Leveraged Benefits

    The use – by a business owner or professional practitioner – ...
  5. Multibank Holding Company

    A company that owns or controls two or more banks. Mutlibank ...
  6. Short Put

    A type of strategy regarding a put option, which is a contract ...
Related Articles
  1. A description of the top retirement plans for self-employed
    Retirement

    Self-Employed? Top Plans For Retirement ...

  2. First time stock investors may ask, is there any way to buy insurance on stocks to prevent losses?
    Options & Futures

    Stock Safety: Top 3 Ways to Limit Your ...

  3. Options & Futures

    Applying Binary Options To Equity Markets

  4. Investors can use derivative securities to effectively buy insurance on their individual holdings or on their portfolio as a whole.
    Options & Futures

    Can You Buy Stock Insurace? 3 Strategies ...

  5. Understanding how to save for retirement does not have to be complicated. Here’s what you need to know about the tax-advantaged accounts you may use.
    Retirement

    Want To Know How To Save For Retirement? ...

Trading Center