Rollovers, Spouse as the Beneficiary, and Backdoor Roth: Today’s Q&A Mailbag
I am a financial advisor in Dallas and appreciate all the training & education Ed has provided over the years to ML advisors like me. I have a question for Ed. When meeting with a potential client, I uncovered a potential problem … And potential subsequent solution but am not sure if it’d work.
The gentleman is 80, still working full-time and loves his job. His much younger wife (age 54) just suddenly died a week or so ago. Neither had/have kids and/or grandkids. He still contributes into his large 401(k) and, since he is still working, is exempt from having to take RMDs since he doesn’t own the >5% of company.
His wife had a large IRA. As a spouse, he has the option of consolidating her IRA into his name. HOWEVER, I’m thinking that doing so would immediately subject him to taking RMDs. He doesn’t need the money.
My thought was to have him roll her IRA into his 401(k) instead. I’m thinking this would sidestep the RMD requirement for now. Just not sure if this is possible and/or what little items would sneak up to bite him.
Thank you in advance,
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