A: The treat-as-own option , which applies only to a spouse who is the sole primary beneficiary, means that the inherited IRA balance is transferred to the surviving spouse’s ‘own’ non-inherited IRA, or by the surviving spouse redesignating the decedent’s IRA as an IRA in his/her name and the decedent’s name is removed from the account registration. The actual procedure is determined by what’s available under the financial institution’s operational procedures. Alternatively, a surviving spouse is deemed to have made the election if, at any time, either of the following occurs --
- Any amount in the IRA that would be required to be distributed under the beneficiary option is not distributed within the applicable deadline or
- The spouse makes contributions to the IRA
The result of the treat-as-own option is that the IRA is treated as if it was established and funded by the spouse, instead of being inherited.
