Retirement tax questions


@fanfare wrote:

You don't have to take RMDs on a Roth IRA.

 

Your best policy is to try to make the Roth IRA grow as much as possible.,

living off the Traditional IRAs.

 

@tealover753 


There IS an RMD required for beneficiary Roth IRAs.  Under the rule for qualified beneficiaries (i.e. a spouse) the RMD is based on the spouse's life expectancy, but the spouse beneficiary does not have to close the account within 10 years unless they opt into the 10 year rule (otherwise, they must withdraw over their entire life).

 

For this reason, and as @dmertz  suggested above, spouse beneficiaries usually assume ownership of the inherited Roth IRA.  Then it becomes their own Roth IRA and there are no RMDs.  

 

(However, if the Roth IRA is treated as an inherited IRA, the entire amount can be withdrawn without tax or penalty as long as the account is at least 5 years old.  If the beneficiary assumes ownership, then they assume the contribution basis, and only the basis may be withdrawn tax-free until the new owner reaches age 59-1/2.)

 

For this reason, and depending on the beneficiary's financial need to make withdrawals before age 59-1/2, it might be useful to assume ownership of the Roth IRA but keep the traditional IRA as an inherited IRA.  However (again), because @tealover753  seems to be having trouble following our answers, and because these decisions can affect the rest of her life, it may be time to find a qualified financial planner to talk to.