My father was well into the time that he was required to take RMDs. The beneficiary was my mother, who pre-deceased my father, so the IRAs go to the estate. Based on documentation we have found it does not look like he was taking the RMDs. We are in the process of getting access to all of his accounts and transferring assets to the estate. And yes, the state, does tax personal income.
My question is more general in that are the missed RMDs overlooked once we liquidate the entirety of the IRA accounts since they would be taxed at a higher rate. See the following two articles in reference to my question.
From: https://www.kiplinger.com/article/retirement/T032-C000-S004-ira-heirs-beware-mistakes.html
- If you miss an RMD, you may avoid the penalty by emptying the account within five years of the owner's death. "However, depending on the size of the IRA and the age of the beneficiary, it might be smarter to pay the penalty than to liquidate the account simply to avoid the penalty," says Twila Slesnick, author of IRAs, 401(k)s & Other Retirement Plans (Nolo, $35).
From: https://www.marketwatch.com/story/whats-a-required-minimum-distribution-and-what-happens-if-you-dont...
- If the taxpayer died before taking an RMD, different rules apply to the beneficiary, such as taking the entire benefit within five years of the owner’s death or beginning installments for the rest of the beneficiary’s life starting no later than a year after the owner’s death, the Internal Revenue Service said.
thanks.
-k.
