Question

Inherited IRA from parent and no RMD

Forum|Forum|4 years ago
February 27, 2022
2 replies
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My husband has an inherited IRA from his Mother that was rolled over in December. His mother passed away in August. She was still working full time and contributing to her 401K at age 81. She was never required to make any RMD withdrawals.

When completing our tax return, we were asked if she was born prior to 1949 and then if any of the withdrawal was an RMD. Our answer would be No.

From what I understand, we would only need to make sure we withdraw all of the funds at sometime over the next ten years. Correct? or any other insight appreciated

fanfare

Employee

"then if any of the withdrawal was an RMD."

was there any withdrawal? if so, it is taxable to you.

What do you mean by "rolled over in December"?

An inherited IRA cannot be rolled over.

D

dmertz

Employee

I think this is describing a direct rollover from a 401(k) to an inherited IRA (codes 4 and G in box 7 of the Form 1099-R).

Because your husband's mother was still working for this employer, she died before her required beginning date for RMDs. Tell TurboTax that none of this distribution was RMD and that no RMD was required with respect to this 401(k).

Regarding beneficiary RMDs that your husband will be required to take, proposed regulations that the IRS issued last week indicate that this account will be subject to both the 10-year rule and annual RMDs. It's not clear if this will change in the final regulations since the IRS seems to have gone back an forth on whether annual RMDs are required in this case under the 10-year rule.