IRA Distribution Rules At Death: Critical Knowledge For Good Decisions
The distribution rules required at the death of an IRA owner depend on several things:
1. Did the IRA owner die before or after the required beginning date?
2. Who is the beneficiary?
In order to carry out the wishes of the IRA owner, evaluating both practical and estate planning implications of various decisions during the IRA owner’s life is essential. Important choices occur when the IRA owner makes his beneficiary election and, if married, by the spouse after the death of the IRA owner.
If you do not know the rules as they pertain to your choices, you are shooting in the dark. The wrong decision can cost money and likely cause the distribution of your IRA to be different than you would want.
Lets make sure you know the rules of the game.
The first element is the required beginning date. For traditional IRAs, SEPs, SIMPLEs, this is Aril 1st of the year after turning 70 1/2. This rule does not apply to Roth IRAs, which have rules of their own.
There are several broad categories of beneficiaries:
1. The spouse.
2. A non-spouse...
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