Attorneys Stephen Korshak and Lee Karina Dani

Distributions from inherited IRAs

by | Oct 25, 2013 | Heirs & Beneficiaries |

A Florida resident who is the non-spouse beneficiary of an IRA should be aware of special federal income tax rules and regulations concerning distributions that apply to these types of accounts. Non-spouse beneficiaries may not treat the IRA as their own, nor can it be rolled over into their own retirement accounts. There are a few options for taking distributions from an inherited IRA.

The first option is to either withdraw all of the funds from the inherited IRA immediately or over a five year period after the owner died, or begin to take required minimum distributions by December 31 of the year after the owner died. Another option is to convert the inherited IRA into a Stretch IRA. In the latter instance, the beneficiary is required to take required minimum distributions each year.

The Internal Revenue Service provides guidelines for beneficiaries who elect to stretch their IRA payments. The Single Life Expectancy Table should be used to determine how much each beneficiary must withdraw every year to be in compliance with applicable required minimum distribution rules. Distributions must begin by December 31 of the year following the death of the original IRA owner.

Distributions from inherited IRAs must be handled in accordance with rules and regulations prescribed by the Internal Revenue Service. There can be different tax consequences for each method that will depend on a beneficiary’s particular situation. An attorney who has experience in estate planning and in dealing with heirs and beneficiaries of estates may be able to help a non-spouse beneficiary of an inherited IRA decide how to take distributions.

Source:, “Biz Brain: Taking RMDs from inherited IRA“, Karin Price Mueller, October 20, 2013