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Q: An individual inherited an IRA from her father, and had been taking distributions over her single life expectancy. She named her son as the beneficiary of her inherited IRA. The original beneficiary had died, and I know her son sons to take distribution from the IRA that he now inherited. Should her son take distributions over his life expectancy or over his mother’s life expectancy?

Also, how should the son’s inherited IRA be titled/registered? That is, should the name of the original owner be included , or should the name of his mother be included?

A:The grandchild (son) should take distributions over his mother’s life expectancy. The mother’s life expectancy is determined in the year after the grandfather died, and 1(one) is subtracted for each year that has passed. 

A second generation beneficiary’s (or successor beneficiary’s) life expectancy is never used to determine distributions from an inherited retirement account.  

The matter of how the account should be titled for a second generation beneficiary (successor beneficiary) is one of those that has not yet been addressed. So, I can only give my opinion. 

Based on the guidance provided in the instructions for filing IRS Form 1099-R and Form 5498, and IRS Notice 2007-7, the account should be titled "Grandchild beneficiary  of Mother( deceased) IRA”, or any other variation, providing it shows the grandchild is the beneficiary, and the mother is the decedent.

IRS Notice 2007-7 A-13 states that “ The IRA must be established in a manner that identifies it as an IRA with respect to a deceased individual and also identifies the deceased individual and the beneficiary, for example, “Tom Smith as beneficiary of John Smith.” Therefore, since the grandchild is the beneficiary of the mother, the registration should show the mother’s name and the child’s name.

Before notice 2007-7 was issued, I would have been less certain, as the instructions for 1099-R/5498 was not as clear.

You may find this question on the registration requirements of inherited IRAs helpful

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