You Asked Us - IRA Beneficiary Options

• Q: How does a spouse beneficiary elect to treat the inherited IRA assets as his/her ‘own’?

• Q: My client inherited an IRA from his father who died at age 80. Can my client use the five-year rule to take distributions from the IRA?

• Q: An individual inherited an IRA from his father, and transferred the IRA balance to an IRA at another firm. However, the IRA to which the transfer was made does not include his father’s name. I understand that as a result (of his father’s name being missing from the registration), the transfer is actually a distribution that is taxable to him when the transfer occurred. Is that true?

• Q. My client inherited an IRA from his aunt in 2005. She was 75-years of age when she died. However, he did not understand the rules and failed to distributed his required minimum distribution (RMD) amount by the December 31 ,2006 deadline. What should he do?

• Separate accounts were established the year after death? Can each beneficiary use their own life expectancies for the year of the split, or must they use the oldest beneficiary’s life expectancy?

• Q: My client inherited an IRA from her uncle who reached age 70 in 2006, and died on January 31, 2007. Is she subject to the rules that apply when someone dies before the RBD or the rules that apply when someone dies after the RBD?

• Q: Are the distribution options for inherited Roth IRAs the same as those that apply to inherited Traditional IRAs?

• 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. 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? ?

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