Post-death distributions of IRAs to Heirs
Post-death distributions of IRAs to Heirs: Bill Harris, CFP, RMA discusses how post-death distributions of IRAs to heirs doesn't work the way you thought. The 10 year rule and IRS Publication 590B are reviewed.
Key Takeaways
- If you inherited an IRA after the SECURE Act, the IRS now expects you to take small RMDs each year leading up to year 10, not just one lump sum withdrawal in year 10—contrary to what most people initially understood
- Until final regulations are published, consider taking at least one RMD by December if you're an inherited IRA beneficiary to demonstrate compliance with the IRS's stated intent, even though guidance remains uncertain
- The 10-year rule interpretation is still in 'proposed regulation' status with pending comment periods, so rules could change—wait as long as possible into the year before making large withdrawal decisions
- If you inherited an IRA from multiple sources at different times (like from both parents), each inheritance may have different rules depending on when it occurred, making professional guidance critical
Post-death distributions of IRAs to Heirs: Bill Harris, CFP, RMA discusses how post-death distributions of IRAs to heirs doesn't work the way you thought. The 10 year rule and IRS Publication 590B are reviewed. To see more videos on finStream TV featuring Bill Harris, click this link: https://www.finstream.tv/featured/bill-harris/
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