dmertz
Level 15

Retirement tax questions

"Is there another choice on taking distributions in addition to the 5 year rule?"

 

Not in this case because your question indicates that the decedent's estate, not an individual, was the beneficiary.  Because the estate does not have a life expectancy, the 5-year rule is the only option and applies even though the respective shares for each of the estate beneficiaries have been assigned out of the estate to separate inherited IRAs for the benefit of the estate beneficiaries.

 

Because the decedent died in 2018 and the 5-year rule applies, the inherited IRAs must be completely drained by the end of 2023.

 

Had the decedent specified the individuals directly as beneficiaries of the IRA and the account was split into separate accounts for the respective shares to each of the beneficiaries, each beneficiary would have been able to have chosen the option for annual RMDs based on their separate life expectancy in 2019, reduced by 1 for each subsequent year (except that 2020 RMDs being waived due to COVID).