Designated Beneficiary
Definition A designated beneficiary is an individual (person) beneficiary whose is designated as beneficiary of a qualified plan account, 403(b) account, 457(b) plan or IRA,
February 28, 2009
No. You cannot rollover or transfer an Inherited IRA to your own IRA, because you are a non-spouse beneficiary. A non-spouse beneficiary is defined as a beneficiary that is not the surviving spouse of the deceased IRA owner. As a non-spouse beneficiary of an IRA owner who died before his required beginning date (RBD), you are required to have the amount moved to an inherited IRA. An inherited IRA is one that is registered in the name of your uncle’s ( the decedent) and your names, using your social security number. An example of a registration that satisfies the IRS requirements is: IRA FBO Jim P, Beneficiary of Tom S (Deceased)”. Any variation of this will work, as long as it is clear who is the beneficiary and who is the decedent. Some financial institutions may shorten ‘beneficiary’ to read ‘bene’, ‘beneficiary of ‘to read ‘B/O’ and/or ‘deceased’ to read ‘decd’.
Depending on the financial institution’s operational requirements, you may need to move the assets to a new account number, or they may reregister the same account number used by your uncle. Any method will satisfy IRS requirements, as long as distributions are reported in your social security number. If the assets are moved to a new account number, it should be done on a non-reportable basis, i.e. it should not be done as a distribution or contribution.
Your distribution options are as follows:
If you fail to withdraw your RMD amount by the deadline, you will owe the IRS an excess accumulation penalty of 50% of your RMD shortfall. For instance, if your RMD for the year is $10,000, and you withdraw only $2,000, you will owe the IRS an excess accumulation penalty of $4,000 ($8,000 x 50%).
Distributions from your inherited IRA cannot be rolled over; however, you can transfer amounts to another inherited IRA, providing the receiving inherited IRA is registered in both your’s and your uncle’s name.
Definition A designated beneficiary is an individual (person) beneficiary whose is designated as beneficiary of a qualified plan account, 403(b) account, 457(b) plan or IRA,
Definition The beneficiary 10-year rule is the maximum period that certain beneficiaries may keep inherited retirement accounts in a beneficiary account. Watch/listen to a video
Definition For beneficiaries who inherit retirement accounts, a common question asked is “What is the 5-Year Rule for beneficiaries?” The beneficiary five-year rule is the
An eligible designated beneficiary is a designated beneficiary who, at the time of the IRA owner or plan participant’s death, is : A. the surviving
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