In Personal Letter Ruling 201902023 (launched Jan. 11, 2019), a belief named as a decedent’s particular person retirement account beneficiary was required annually to pay the surviving partner the IRA’s earnings, or, if larger, the 12 months’s required minimal distribution (RMD).
After the IRA proprietor died, documentation was well timed supplied to the IRA custodian, assembly a requirement to allow the belief to make RMDs over the life expectancy of the partner.
The IRS confirmed that the partner can be handled because the IRA’s beneficiary for functions of RMDs (making the belief a so-called "look-through" or "conduit" belief); and that the annual divisor used to compute distributions can be recalculated annually (Treasury Rules part 1.401(a)(9), Query and Reply - 5(c)(2)).
Essentially the most attention-grabbing takeaway from this ruling is that the relevant divisor of a conduit belief with respect to a surviving partner received’t be diminished by one annually, as can be the case if recalculation hadn’t been allowable.
Post a Comment