Trust disclaiming
According to Rev. Ruling 2005-36, a trust can disclaim any or all of the retirement benefits within 9 months of account owner’s death. If trust disclaims, who then would get the money? I am assuming the contingent beneficaries, if listed. If no contingent beneficiaries, would the money then go to the trust beneficiaries? And if to the trust beneficiaries, would RMD be based on oldest?
Furthermore, if trust disclaims that must be trhu trustee, correct? And what if the trustee also happens to be one of the two beneficiaries of trust?
Permalink Submitted by Alan Spross on Thu, 2007-09-06 05:23
2005-36 allows an IRA beneficiary to disclaim after receiving the RMD of the decedent owner. I don’t see where it addresses trustee disclaimer filings.
However, if a trustee can disclaim under the terms of the trust and state law, any contingent beneficiary would acquire the assets. If there is none, then the IRA agreement would establish default provisions. The RMD would be determined as if the trust never existed. If an individual was named as contingent, then that person’s life expectancy would apply or the oldest beneficiary if separate accounts were not created by the deadline.
A qualified disclaimer requires that the assets do not pass to that disclaimant as a beneficiary with an exception for the decedent’s spouse.