Is a lump sum beneficiary annuity distribution considered a RMD?

scottfoley5040 · ‎June 6, 2019

If I take the lump sum option on an inherited annuity, do I check "YES" to Turbo's question...."Is this a RMD"? I'm required to have all the money out of the annuity no later than 5 yrs following my mother's death. I know what the taxable portion is.....I just don't know if this is considered a RMD.

Fern · ‎June 6, 2019

If you take a total distribution, the RMD requirement is met. You would check "Yes" .

RMD is required for all retirement accounts. That is why Turbo Tax has to ask the question. When you inherit an account from someone other than your spouse, you have to take an RMD based on that person's age.

The Required Minimum Distribution (RMD) amount for a retirement account is determined by applying a life expectancy factor set by the IRS to your account balance at the end of the previous year. To calculate your RMD:

Find your age in the IRS Uniform Lifetime Table (below).
Locate the corresponding life expectancy factor.
Divide your retirement account balance as of December 31 of the prior year by your life expectancy factor.

Is a lump sum beneficiary annuity distribution considered a RMD?

Retirement tax questions