Inherited IRA’s and Retirement Plans

required distributions

Note:  The SECURE and SECURE 2.0 Acts dramatically changed the RMD rules for IRA assets inherited by most non-spouse beneficiaries. A financial or estate-planning professional can help you determine how the new rules may affect your estate-planning strategies.

Required Minimum Distributions(RMD’s) for IRA owners  will cease after death, but the IRA owner’s beneficiary(ies) will have to continue to take RMD’s eventually. How much the beneficiary is required to take and when they are required to take them depends on whether they are eligible designated beneficiaries (EDB’s) and whether the IRA owner dies before or after beginning to take their RMD’s.

Generally speaking, EDB’s may spread RMD’s over their own life expectancy, while non-EDB’s are typically required to liquidate the account within 10 years. A spouse who is the sole beneficiary may generally roll over an inherited IRA or plan account into an IRA in the spouse's own name or treat the account as his or her own, allowing the spouse to delay taking additional RMD’s until he or she reaches RMD age.

As with required lifetime distributions, proper planning for required post-death distributions is essential. You should consult an estate planning attorney and/or a tax professional.

To learn more, contact MNM Vested, LLC