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URL:  http://boards.fool.com/dingue-you-asked-can-the-beneficiary-of-an-ira-12837222.aspx

Subject:  Re: non spouse IRA beneficiary Date:  7/2/2000  3:11 PM
Author:  SuzanneSLO Number:  37094 of 121177

Dingue: You asked: Can the beneficiary of an IRA be changed from a spouse to a daughter?
The owner is already taking required minimum distributions from the IRA and wishes to change the beneficiary.


The IRA owner can change the beneficiary at any time, but it is less advantageous to do so after the required beginning date at which time required minimum distributions(RMDs) must be taken.

A change after that date has the following effect:

If the new bene is older than the former bene, then the RMDs are recalculated based on the age of the new bene. This may mean a required faster pay-out of IRA assets.

If the new bene is younger, then there is no change in the calculations of the RMD.

Upon the death of owner, what options will
the daughter have?


If the daughter inherits the IRA as the bene, then her pay-out is determined by the joint life expectancy of her father and his spouse. The spouse's LE is relevant 'cuz she was the bene at the required beginning date.

Unless the spouse was ten or fewer years younger than the father, there would be no change in the minimum pay-out to the daughter. If the spouse was ten or fewer years younger, then the RMDs are recalculated following the father's death and the minimum pay-out is strecthed over additional years.

The daughter also has the option to take more than RMDs at any time. She must begin taking at least the RMDs no later than 12/31 of the year following her father's death.

As previously noted, the spouse will have to consent to naming the daughter as bene.

Good luck. -- Suzanne
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