Decedent neglected to name Ira beneficiary but in his will named his spouse as inheritor of estate
This question must have come up before but I am trying to find an answer. If someone did not name any beneficiary in his Ira but left his entire estate to his spouse in his will does the inheriting spouse have to withdraw the proceeds within five years or can she stretch it out. The decedent was 72 years old and lived in a community property state.
Permalink Submitted by Alan - IRA critic on Fri, 2019-11-01 01:38
First, the IRA agreement must be checked to determine if a default beneficiary is indicated. Some custodians may specify the surviving spouse as such. If not and the estate is the default beneficiary, because the decedent passed after the RBD, the applicable distribution period is the decedent’s remaining life expectancy. The 5 year rule never applies for deaths after the RBD. There are also several PLRs allowing a surviving spouse in this situation to do the spousal rollover. This is simpler if the spouse is also the executor of his estate as well as being the sole beneficiary.
Permalink Submitted by Bruce Steiner on Sun, 2019-11-03 02:49
There are dozens of private letter rulings allowing a rollover in this situation. I’ve obtained some of them. I wrote an article on this in the October 1997 issue of Estate Planning, https://www.kkwc.com/wp-content/uploads/2015/04/AR20050125164755.pdf , and another article on this for the June 2015 issue of Trusts & Estates, https://www.kkwc.com/wp-content/uploads/2015/08/IRA-Rollovers-Making-this-option-possible.pdf .Depending on the custodian, they may want a ruling or an opinion of counsel before allowing the rollover.