3629. How are the minimum distribution requirements met after the death of an IRA owner who died before his required beginning date?Nuco Employeercline202014-06-04T13:11:00Z2014-06-04T13:11:00Z36493703Albany Law School308434414Site Map/Individual Retirement Plans/Roth IRA/Distributions/Minimum Required DistributionsSite Map/Individual Retirement Plans/Traditional IRA/Distributions/Minimum Required Distributionsrequired minimum distributions RMD MRD required beginning date2005-01-25T00:00:00ZTaxFactsDefaultArticleSite Map/Individual Retirement Plans/Quick Clicks/Required Minimum Distributions114880235-00-tf1.xml236.00;#1814;#1823;#1800;#0x010100C568DB52D9D0A14D9B2FDCC96666E9F2007948130EC3DB064584E219954237AF3900242457EFB8B24247815D688C526CD44D009C4E67E972694125ABDA91AC61F5E51FTax Facts 1How are the minimum distribution requirements met after the death of an IRA owner?109200.000000000TaxFactsDefaultArticleSBMEDIA\moss-admin2010-01-19T08:12:09Z3629. How are the minimum distribution requirements met when of an IRA owner dies before his required beginning date?If an IRA owner dies before his or her required beginning date, distributions must be made under either a life expectancy method or the five year rule.Treas. Reg. §1.401(a)(9)-3, A-1(a). After-death distributions from a Roth IRA will be determined under these rules because the Roth IRA owner is treated as having died before his or her required beginning date.Treas. Reg. 1.408A-6, A-14(b).Life Expectancy Method:Under the life expectancy rule, if any portion of the interest is payable to, or for the benefit of, a designated beneficiary, that portion must be distributed over the life (or life expectancy) of the designated beneficiary (Q 3632)IRC Sec. 401(a)(9)(B)(iii), Treas. Reg. §1.401(a)(9)-3, A-1(a). To the extent that the interest is payable to a nonspouse beneficiary, distributions must begin by December 31 of the calendar year immediately following the year in which the IRA owner died.Treas. Reg. §1.401(a)(9)-3, A-3. The nonspouse beneficiary’s life expectancy for this purpose is measured as of his or her birthday in the year following the year of the owner’s death and is determined using the Single Life Table (see Appendix ___). Treas. Reg. §1.401(a)(9)-9. In subsequent years, this amount is reduced by one for each calendar year that has elapsed since the year of the owner’s death.Treas. Reg. §1.401(a)(9)-5, A-5(c)(1). After the death of a non-spouse beneficiary, the payout period to the successor beneficiary will determined using the deceased beneficiary’s remaining life expectancy (based on the age of the beneficiary in the calendar year of death) reduced by one for each calendar year that elapses thereafter. Treas. Reg. §1.401(a)(9)-5, A-7(c)(2).For the treatment of multiple beneficiaries, see Q 3632.A surviving spouse who is the sole designated beneficiary of an IRA generally may elect to treat the IRA as his or her own (see Q 3631). Unless this election is made, distributions to a surviving spouse beneficiary must begin by the later of the end of the calendar year immediately following the calendar year in which the owner died, or the end of the calendar year in which the owner would have reached age 70½.IRC Sec. 401(a)(9)(B)(iv); Treas. Reg. §1.401(a)(9)-3, A-3. The payout period is the surviving spouse’s life expectancy, based on his or her attained age in each calendar year for which a minimum distribution is required.Treas. Reg. §1.401(a)(9)-5, A-5(c)(2). After the surviving spouse dies, the payout period is that spouse’s remaining life expectancy, based on the age of the spouse in the calendar year of death, reduced by one for each calendar year that elapses thereafter.Treas. Reg. §1.401(a)(9)-5, A-5(c)(2).Planning Point: The term “stretch IRA” does not appear in the Internal Revenue Code, but simply describes, in popular usage, the practice of IRA distribution planning that successfully permits the beneficiaries (e.g., a surviving spouse and a child of the owner) to receive distributions over their individual life expectancies under the foregoing rules, and satisfy the requirements for separate accounts (Q 3632). A younger beneficiary allows for greater stretching.A designated beneficiary who does not elect the 5 year method but fails to timely start distributions under the life expectancy method may be able to make up the missed RMDs and pay the 50 percent penalty on the missed distributions, rather than receive the entire balance within 5 years.Let. Rul. 200811028.5 Year Method:Under the five year rule, the entire interest must be distributed within five years after the death of the IRA owner (regardless of who or what entity receives the distribution).IRC Sec. 401(a)(9)(B)(ii); Treas. Reg. §1.401(a)(9)-3, A-1(a). To satisfy this rule, the entire interest must be distributed by the end of the calendar year that contains the fifth anniversary of the date of the IRA owner’s death.Treas. Reg. §1.401(a)(9)-3, A-2.Planning Point: The five year period is expanded to six years if 2009 is one of the five years. IRC Sec. 401(a)(9)(H)(ii).Tables contain single and joint and survivor life expectancies for calculating required minimum distributions, as well as a “Uniform Lifetime Table” for determining the appropriate distribution periods.Treas. Reg. §1.401(a)(9)-9. See Appendix F for details.