Non Spousal - Inherited IRA 2020 | Ed Slott and Company, LLC

Non Spousal - Inherited IRA 2020

Does this qualify as being an "eligible designated beneficiary" and still be able to use the stretch IRA distribution option?

IRA Owner (age 50 and single), dies January 2020, and leaves her IRA to her sister as beneficiary
Her sister is age 58, and has this account now held within an inherited IRA in her name.

In that case, I'm thinking the sister would qualify an one of the exceptions to the changed 10-year rule and would be able to use a stretch option, with RMD beginning in 2021(the year following death), using single life expectancy factor for age 59(in 2021) of 26.1 and then decreasing the RMD life expectancy factor by 1 each year.

Thanks
Matt

You are correct. SIster can stretch the inherited IRA as an EDB since she is not more than 10 year younger than decedent. 26.1 is correct divisor using current table I, however if new tables are adopted for 2021, that divisor will rise slightly.

 

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