If you’ve become the beneficiary of an IRA or other retirement account, it’s important to know your options.
You can take the money out in one lump sum. This requires opening an account called an Inherited IRA in your name for correct IRS reporting.
That lump sum may be taxable depending on whether the original contributions were pre or post-tax.
Or you can open an Inherited IRA and leave it alone to grow tax-deferred. You can’t make any additional contributions and must take Required Minimum Distributions based on when the deceased would have turned 70 ½. With this option, you can name your own beneficiary to pass it on.
If your spouse left you the account, you’re allowed to roll those assets into your own retirement account and follow your account’s distribution rules.
You could also disclaim the account, or not accept it. The assets can then pass on to alternate beneficiaries.
If you disclaim, it must be done before taking possession of the account, and within nine months of the original owner’s death.
To learn more about what to do with an inherited retirement account, please give us a call today.
For more on this topic and other resources, please check out https://carsonallaria.com/
Disclaimer: All material discussed on this video is for educational purposes only and should not be construed as individual tax, legal, or investment advice. Investing involves risk of loss and investors should be prepared to bear potential losses. Past performance may not be indicative of future results. Joe Allaria is an Investment Adviser Representative of CarsonAllaria Wealth Management, a Registered Investment Advisory firm. Information discussed on this video may be derived from third parties that are believed to be reliable, but CarsonAllaria Wealth Management does not control or guarantee the accuracy or timeliness of such information and disclaims all liability for damages resulting from such sources. Any references to third parties are provided as a convenience and do not constitute an endorsement.
