Inherited Roth IRA Factor Calculation
Questions: When a non-spouse IRA beneficiary is older than the IRA owner, can the deceased owner’s age be used to determine the RMD factor? And, is there any difference in an RMD factor calculation between Roth and Traditional Inherited IRAs?
Details: A client’s trust was the beneficiary of both his Roth and Traditional IRAs pre-2020. The trust beneficiaries were two individuals, the older of which is older than the IRA owner. With the new tables, I’m getting mixed results from the various RMD calculators out there. For the Roth, the calculator was using the older beneficiary’s age to determine the factor and for the Traditional it was using the younger IRA owner’s age.
Permalink Submitted by Alan - IRA critic on Wed, 2022-06-01 19:53
The reason for that difference is probably that the account owner’s age can only be used if they passed after the RBD, but a Roth owner can never pass after the RBD because there is no RBD for a Roth owner. Therefore, I would guess that this owner passed after the RBD for the TIRA allowing the owner’s age to be used, while for the inherited Roth IRA, the beneficiary age would apply since death was prior to RBD for the Roth. Of course, there are other variables in play here, such as whether death was post Secure Act or not, and if the trust is qualified for look through or not.