- Alice (63) and Bob (68) are married and each has both a traditional and Roth IRA
- Bob's IRA beneficiary designation is 60% to Alice and 40% to his brother Charlie (58), on both the traditional and Roth IRA.
When Bob dies, his brother is required to keep the 40% he inherited in a separate account and begin taking RMDs based on his (Charlie's) life expectancy, starting the tax year after Bob's death.
My question is about the rules for Alice. It is clear that if the beneficiary designation had given her 100%, she could "assume" the account directly into her own IRA. The rules I've been able to find are not explicit about her options when she inherits less than 100%. Direct assumption does not seem to be possible, but it appears that she still has two options:
- Leave the inherited funds in the separate account and take RMD based on her life expectancy starting the following year.
- Roll the assets over into her own IRAs and delay RMDs until 70½.
To clarify more -- When Bob dies, the custodian splits each IRA 60/40 into two new accounts. the 40% portions go to Charlie, who is required to start RMDs the following year based on his (Charlie's) life expectancy. Charlie CANNOT move/rollover the inherited assets to any other account.
My question applies to Alice's 60% which she also receives initially as "Inherited IRA" accounts. Is she free to then assume those accounts (i.e. roll the assets into her personal accounts) thus delaying RMDs until she turns 70½?