The IRA Contribution Deadline and Inherited IRAs: Today's Slott Report Mailbag | Ed Slott and Company, LLC

The IRA Contribution Deadline and Inherited IRAs: Today's Slott Report Mailbag

By Sarah Brenner, JD
Director of Retirement Education
Follow Us on Twitter: 
@theslottreport


Question:

Has the deadline to make an IRA contribution for 2020 been extended since the 2020 tax filing date has been extended to May 17, 2021?

Robert


Answer:

Hi Robert,

Yes. The 2020 IRA contribution deadline is also extended to May 17, 2021.


Question:

Hi Ed,

My mother recently passed away in February 2021 from Covid. Prior to her passing I transferred her Traditional IRA from one brokerage account to a managed account with no beneficiary listed for the new account. The account will now go to the estate in which I am the sole beneficiary listed in her last will and testament. What are my options? My mother was 80 years old and had started her required minimum distributions.

Thank you for your help,

Scott


Answer:

Hi Scott,

Our condolences on the death of your mother.

It sounds like the estate became the IRA beneficiary by default. Because your mother was taking required minimum distributions (RMDs), the estate will need to take her 2021 RMD if she did not take it already. 

Beginning next year, RMDs would then need to be taken annually based on your mother’s remaining nonrecalculated single life expectancy. For 2022 RMDs the IRS has released new life expectancy tables to be used. If your mother reached her 80th birthday in 2021, the factor would be determined using age 80 and the new single life expectancy table. That would be 11.2. Each year one is subtracted from that factor. So, to calculate the RMD for next year, a factor of 10.2 would be used. Of course, the estate can always take the funds more quickly than is required.

 

 

 


Content Citation Guidelines

Below is the required verbiage that must be added to any re-branded piece from Ed Slott and Company, LLC or IRA Help, LLC. The verbiage must be used any time you take text from a piece and put it onto your own letterhead, within your newsletter, on your website, etc. Verbiage varies based on where you’re taking the content from.

Please be advised that prior to distributing re-branded content, you must send a proof to matt@irahelp.com for approval.

For white papers/other outflow pieces:
Copyright © [year of publication], [Ed Slott and Company, LLC or IRA Help, LLC - depending on what it says on the original piece] Reprinted with permission [Ed Slott and Company, LLC or IRA Help, LLC - depending on what it says on the original piece] takes no responsibility for the current accuracy of this information.

For charts:
Copyright © [year of publication], Ed Slott and Company, LLC Reprinted with permission Ed Slott and Company, LLC takes no responsibility for the current accuracy of this information.

For Slott Report articles:
Copyright © [year of article], Ed Slott and Company, LLC Reprinted from The Slott Report, [insert date of article], with permission. [Insert article URL] Ed Slott and Company, LLC takes no responsibility for the current accuracy of this article.

Please contact Matt Smith at matt@irahelp.com or (516) 536-8282 with any questions.

 

Find members of Ed Slott's Elite IRA Advisor GroupSM in your area.
We neither keep nor share your information entered on this form.
 

I agree to the terms and services:

You may review the terms and conditions here.