No. of Recommendations: 6
Question is: how much is the RMD? If the beneficiary is, say, 25 years old, then he isn't going to find his RMD in the tables that are published. The tables I've seen start at age 72. Apparently there is a table, but you use is in a weird manner:
"Example: Karen inherited a traditional IRA from her mother Linda, who died at age 85 in 2020. Under the SECURE Act, Karen is subject to the 10-year rule. She must empty the inherited IRA account by December 31, 2030. The new IRS final regulations also require her to take annual RMDs based on her life expectancy in years one through nine of the 10-year payout period. Due to the IRS waiver of the penalties for missed RMDs in years 2021, 2022, 2023, and 2024, Karen does not need to take RMDs for those years. However, beginning in 2025 she must take an annual RMD for years 2025-2029 from the inherited IRA.
So, how are Karen’s annual RMDs for 2025-2029 calculated assuming she turned age 60 in 2020 (the year her mother Linda died)? Let’s start with the 2025 RMD. Karen turns 65 in 2025. You might think we would look at the current IRS Single Life Table, see that the life expectancy of a 65-year old is 22.9 and assume that Karen’s 2025 RMD is the 12/31/24 value of the inherited IRA divided by 22.9.
But that would be too easy. Instead, we must go back and figure out what Karen’s baseline life expectancy was in 2021 (the year following the year Linda died) when she was 61, and then subtract 1.0 for each subsequent year up to 2025. The life expectancy of a 61-year old under the current IRS Single Life Table is 26.2. Subtracting 1.0 for each subsequent year gets us to a 22.2-year life expectancy for Karen’s 2025 RMD. Karen’s 2026 RMD will be 21.2 (22.2 -1.0), her 2027 RMD will be 20.2 (21.2 – 1.0), and so on until 2030. In 2030, Karen must take out all of her remaining of the inherited IRA."
https://irahelp.com/slottreport/how-are-annual-rmd...
