Successor Trustee
For estate tax purposes John and Jane named trusts as IRA beneficiaries. John has since died leaving Jane as the trustee. Jane is now incapacitated. Her son, Brian is successor trustee. We’re completing the paperwork to reflect his role as acting trustee.
John died before his required beginning date. Jane is now 79, and we have been taking RMDs based on her life expectancy. I believe we continue on that schedule and that changing the trustee on the account registration has no effect on the calculation. Is that correct?
Permalink Submitted by Alan - IRA critic on Sat, 2016-05-21 00:04
That is correct. If the trust is qualified for look through treatment the RMDs are based on the oldest beneficiary of the trust.
Permalink Submitted by Ben Meyer on Sat, 2016-05-21 15:14
Just trying to confirm, for a trust qualified for look-through or see-through treatment, that it is permissable to make transfers to separate IRA accounts for one or more beneficiaries before September 30 of the year following the date of death. In these cases, would the RMD be determined for each account by the lifetime of the individual beneficiary holding that account? (Instead of the oldest beneficiary of the trust?)
Permalink Submitted by David Mertz on Sat, 2016-05-21 17:13
See the note at the bottom pf page 12 of 2015 Pub 590-B which says, “The separate account rules, discussed earlier, cannot be used by the beneficiaries of the trust.” This means that RMDs are based on the age of the oldest beneficiary even if separate accounts are created and distributed from the trust, as would be the case if separate accounts were not created.
Permalink Submitted by Herm Brames on Sun, 2016-05-22 03:13
The original post uses the plural “trusts” which to me implies individual trusts. If in fact there were individfual trusts, would the same answer prevail?