eligible designated beneficiary

Ghost vs. 5-Year: The Calendar Dictates

Ever since the SECURE Act created a 10-year payout rule for most IRA beneficiaries, that topic has garnered the bulk of conversation. This is understandable. Not only was the 10-year rule a brand-new payout structure, but questions swirling around application of the 10-year window remain unsettled.

How to Lose an Inherited IRA and Gain a Big Tax Bill

Did you inherit an IRA from someone who is NOT your spouse? This is not uncommon. Maybe you inherited from a sibling or a parent or a friend. If this is your situation, proceed with caution! For nonspouse beneficiaries, a wrong move can result in disastrous consequences. So, take your time and do it right.

IRA Beneficiary Payout Rules – the Madness Continues

The lunacy of IRA beneficiary payout rules continues to boggle the mind. As I guide advisors through the options available to their clients, various nuances present one unique scenario after another. Did the original IRA owner pass away before or after the establishment of the SECURE Act? How old was the person when they died? Who was the beneficiary? Is this a successor beneficiary situation? Ultimately, by following the individual fact patterns, definitive answers materialize.

Death of an IRA Beneficiary – Before Claiming the Account

When an IRA owner dies, we look to the beneficiary form to determine who should receive the IRA funds. After death, there is a transition process as assets are moved into an inherited IRA for the beneficiary. But what if the beneficiary dies after the death of the original IRA owner, but prior to claiming the account?

Inherited IRAs and SIMPLE IRA Creditor Protection: Today’s Slott Report Mailbag

Question: In 2021, my wife inherited an IRA from her sister who was 4 years younger. My wife therefore is an EDB (eligible designated beneficiary). Her sister was 66 years old at date of death. My wife has been taking RMDs based on her own age. What happens when my wife dies? Do all the following beneficiaries have 10 years to deplete the inherited IRA? Are there RMDs that need to be taken each year for those beneficiaries? If so, is the RMD based on the factor that my wife was using?

INHERITED IRA 10-YEAR RULE AND DISABLED CHILD AS ELIGIBLE DESIGNATED BENEFICIARY: TODAY’S SLOTT REPORT

Question: Hello, I have an inherited IRA which falls under the 10-year rule. I understand that the IRS has tried to clear up the 10-year RMD (required minimum distribution) confusion but I am still not sure which RMD Table I am supposed to use! I am a non-spouse (daughter of the deceased) and it's confusing. Will I need to make up the RMDs for the first two years when the rules were not clearly stated? Thank you,

EDBs Have a Choice: Stretch vs. 10-Year

By now, most are aware the SECURE Act created a new class of beneficiaries called “eligible designated beneficiaries” (EDBs). This group includes surviving spouses, minor children of the account owner (until age 21), disabled individuals, chronically ill individuals, and people who are not more than 10 years younger than the IRA owner. (Those older than the IRA owner also qualify.)

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