Estate Law Questions? Ask an Estate Lawyer.
Hello and thank you for the question. I am sorry to read of this dilemma.
I will answer each of your questions in turn
the rmd is based on the oldest non spouse beneficiary
The rmd in this situation is based on the amount in the individual account created for each beneficiary child
Each beneficiary may name his or her own beneficiary, which should be done in the account, by will or trust.
I wish you the best and a nice weekend. Kindly let me know if the answer is acceptable.
awaiting your reply on review of the answers.
As I understand it, the RMD is based on the account value on 31 December of the prior year, e.g. Value on 31 December 2013 is used to calculate the RMD for 2014. It doesn't appear that the IRA will be fulling distributed by 31 December though. So how is RMD figured when there has only been a partial distribution and an amount still remains in the trust's IRA?
that is the general rule
it can only be based on amounts in individual accounts as distributed out of the trust
What of the amount remaining in the trust as of Dec 31?
with the rmd based on what went into the specific sub ira accounts to non spouse beneficiaries
that is excluded
Excluded? The IRS is still going to want their "fair share".
this is amount that did not pass to the beneficiaries correct?
or at least not yet?
It passes to the beneficiaries. The estate is just wrapped up in a legal quagmire at the moment and the distribution likely will not happen prior to the end of the year.
The trust states that the proceeds are to be distributed outright. There are no legal strings attached.
where there is vested interest
and it passes to the beneficiaries
no strings attached, there is a tax due
so the trust amount which goes to the beneficiary would be taxable
based on such facts
I wish you the best.
So is the trustee (also one of the beneficiaries) responsible for paying the RMD out of any undistributed portion that remains in the trust?
to the extent of his personal share
on his personal share
So each beneficiary is responsible to pay the RMD on their share of the entire IRA, regardless of whether they've received their share in its entirety?
have a nice day
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