Secure act for Domestic Partner

[Sandy & Shirley]

The Secure Act basically eliminated the “stretch” provision for non-spouse beneficiaries, the ability to pass a Roth IRA to another person who would keep it for their life than pass it on to the next person for the rest of their life, etc. Under the Secure Act an IRA now has to be liquidated within 10 years of inheriting it: except for a few exceptions.

The exception that I’m interested in is for Domestic Partners. My partner is 8 years and 11 months younger than I am, and according to an on-line review of the Act by Michael Kitces, the “10-Year Rule” does not impact, among others, “those not more than 10 years younger than the decedent”. But, I can’t find that exact wording in the government-speak text of the act that is on line.

For those who understand government jibber jabber, is it true that I can leave my Roth IRA to my partner, 9 years younger, who can use it for the remainder of her life even if it is more than 10 year, then she can leave both Roth IRAs to be divided between our 6 combined children who would then have to withdraw all of the money within 10 year of inheriting it.

 

[MissMolly]

Are you married to your partner, which makes them a spouse, or are you just partners like a heterosexual couple who is not married? It is my understanding that the Secure Act removed the stretch provision for all who are not married. The 10 year younger rule, in the past at least, was referencing which table had to be used for calculating withdrawal amounts. The Secure Act effectively did away with that also since it's now just required to empty the account in 10 years for non-spouse heirs when the deceased dies anytime after 2019. For folks like me who inherited a non-spouse IRA the tables are still applicable since I inherited the IRA in 2013.

 

[cathy63]

... The exception that I’m interested in is for Domestic Partners. My partner is 8 years and 11 months younger than I am, and according to an on-line review of the Act by Michael Kitces, the “10-Year Rule” does not impact, among others, “those not more than 10 years younger than the decedent”. But, I can’t find that exact wording in the government-speak text of the act that is on line.

There is no exception for domestic partners. There is an exception for a beneficiary who is not more than 10 years younger than the owner of the account. That person can be your best friend, your parent, your domestic partner, a complete stranger, etc. It doesn't matter as long as they're older than your age minus 10 years.

The language for this is in Section 401. https://www.congress.gov/bill/116th-congress/house-bill/1994/text#H8CCAAB708CB24F379EC4DA53B75DCC62

“(V) an individual not described in any of the preceding subclauses who is not more than 10 years younger than the employee.

For those who understand government jibber jabber, is it true that I can leave my Roth IRA to my partner, 9 years younger, who can use it for the remainder of her life even if it is more than 10 year, then she can leave both Roth IRAs to be divided between our 6 combined children who would then have to withdraw all of the money within 10 year of inheriting it.

Yes. However, if any of the children is less than 10 years younger than your partner, is disabled, or is a minor when your partner dies, then they could also stretch distributions longer than 10 years.