Inherited non-spousal IRA
Terry, 2 years ago I inherited a non-spousal IRA upon the death of my mother who inherited it upon the passing of her husband, my father. I was told by numerous financial advisors that it must have a balance of 0, 10 years after her death but then they said maybe…no final decision from government. Is it still being debated or must it be gone in the 8 years? Thank you
Terry Says
There were some delays in instituting the rule, but yes, non-spousal beneficiaries must liquidate an IRA by the end of 10 years after the death of the grantor. So you have 8 years to go!! And you must pay taxes on the RMDs, don’t forget — so maybe ask the custodian to withhold 20% for taxes.
But these rules are complex, so here’s a complete guide to the process: Did You Inherit an IRA? Follow These Rules to Avoid Taxes (investopedia.com)
