Inherited Roth IRA Distributions

Forum|Forum|3 years ago
February 24, 2023
4 replies
50 views

Our mother died at age 96 in December 2020. My only sibling and I (designated beneficiaries) each rolled half of her Roth IRA into our own new inherited Roth IRAs in 2021. My 72nd birthday occurred in 2022. I intend to empty my inherited Roth IRA before December 31, 2030 without taking annual RMDs. Is this the correct course of action?

Not A Product Question

Best answer by user17750693608

Yes, a non-spouse who is not an eligible designated beneficiary follows the ten year rule.

Non-spouse beneficiary options

In 2020 and later, options for a beneficiary who is not the spouse of the deceased account owner depend on whether they are an "eligible designated beneficiary." An eligible designated beneficiary is

Spouse or minor child of the deceased account holder
Disabled or chronically ill individual
Individual who is not more than 10 years younger than the IRA owner or plan participant

An eligible designated beneficiary may

Take distributions over the longer of their own life expectancy and the employee's remaining life expectancy, or
Follow the 10-year rule (if the account owner died before that owner's required beginning date)

Designated beneficiary (not an eligible designated beneficiary)

Follow the 10-year rule

Beneficiary that is not an individual

Follow the rules described above as if the account owner died before 2020 (because the SECURE Act changes only apply to beneficiaries who are individuals)

user17750693608Answer

Level 8

Yes, a non-spouse who is not an eligible designated beneficiary follows the ten year rule.

Non-spouse beneficiary options

In 2020 and later, options for a beneficiary who is not the spouse of the deceased account owner depend on whether they are an "eligible designated beneficiary." An eligible designated beneficiary is

Spouse or minor child of the deceased account holder
Disabled or chronically ill individual
Individual who is not more than 10 years younger than the IRA owner or plan participant

An eligible designated beneficiary may

Take distributions over the longer of their own life expectancy and the employee's remaining life expectancy, or
Follow the 10-year rule (if the account owner died before that owner's required beginning date)

Designated beneficiary (not an eligible designated beneficiary)

Follow the 10-year rule

Beneficiary that is not an individual

Follow the rules described above as if the account owner died before 2020 (because the SECURE Act changes only apply to beneficiaries who are individuals)

Opus 17

Level 15

[Removed by author]

dmertz

Level 15

leeloo is correct, Opus 17 is incorrect. A Roth IRA participant is treated as passing before their Required Beginning Date for RMDs (because the participant is not required to take RMDs from a Roth IRA), so annual beneficiary RMDs are not required. The only requirement is that the inherited Roth IRA be emptied by December 31, 2030.