ANOTHER Inherited IRA Question, ROTH this time..

[cathy63]

I have an inherited Roth IRA question too.
My brother has a Roth IRA outside of his Irrevocable trust account. I am the beneficiary.
Since I am within 10 years of his age (younger), then am I considered an eligible beneficiary and am not subject to the 10 year mandatory withdrawal rule?

Yes, that's correct. You will still be required to take RMDs from the account, even though it's a Roth. RMDs begin in the year following the owner's death, even if you haven't reached your own beginning age.

 

[Dtail]

Yes, that's correct. You will still be required to take RMDs from the account, even though it's a Roth. RMDs begin in the year following the owner's death, even if you haven't reached your own beginning age.

Confused. My question was NOT being subject to RMD's due to being within 10 years of my brothers' age. You stated I was correct but NEED to take RMD's.

 

[cathy63]

Confused. My question was NOT being subject to RMD's due to being within 10 years of my brothers' age. You stated I was correct but NEED to take RMD's.

Sorry, I should have put a blank line between my answer to your original question and my additional point. The question you asked was "I am not subject to the 10 year mandatory withdrawal rule?" You are correct, you are not subject to the 10-year withdrawal rule.

You did not ask about RMDs, but you do have to take them. They will be based on your life expectancy at the time you inherit.

 

[Dtail]

Sorry, I should have put a blank line between my answer to your original question and my additional point. The question you asked was "I am not subject to the 10 year mandatory withdrawal rule?" You are correct, you are not subject to the 10-year withdrawal rule.

You did not ask about RMDs, but you do have to take them. They will be based on your life expectancy at the time you inherit.

Thanks for the clarification.
One last question though using the below example.
If I inherit the Roth IRA at age 69, then do I have to take the RMD starting at age 69 for the life expectancy or do I wait until my natural RMD first distribution at age 75?

 

[cathy63]

Thanks for the clarification.
One last question though using the below example.
If I inherit the Roth IRA at age 69, then do I have to take the RMD starting at age 69 for the life expectancy or do I wait until my natural RMD first distribution at age 75?

RMDs for inherited accounts start in the year following the death of the original owner regardless of the age of the beneficiary. In your example, if you inherit at age 69, you'd start RMDs from that account at age 70.

 

[TheWizard]

Thanks. The thing is it's a Roth, so there won't be any taxes on it, but still interested in keeping it conservative since if any market dip occurs in the next 6 years, there is potentially no time to wait out gains to come back since the account is on an inherited "timer".

This makes very little sense.
In six years, whatever amount of money is still in that inherited Roth IRA comes out and gets commingled with whatever other money you have in your taxable investment account.

The only "timer" worth considering might be if you are planning a large purchase (real estate?) at some future date.
Aside from that, the principal of Asset Location says to hold stocks in your Roth and taxable accounts and bond-like securities in your tax-deferred account, to the extent that your AA allows...

 

[Dtail]

RMDs for inherited accounts start in the year following the death of the original owner regardless of the age of the beneficiary. In your example, if you inherit at age 69, you'd start RMDs from that account at age 70.

Thank you again. Okay finished with the questions.