My father died in 1992 and my mother inherited his IRA. She began taking distributions in 1995 reaching the required age. We chose the Single Life / Recalculate method and have been taking the minimum distributions each year. She has been recieving warnings from friends that she will be placing a tax burden on my sister and I, who are the beneficaries, when she dies. She is age 76 and in decent health. Are the IRS rules still that when she dies, the total amount of IRA needs to be withdrawn by the beneficiary's? and reported as ordinary income for that tax year? Any way to avoid or lessen this burden? She has three grandchildren who could be beneficiary's although oldest is only 12. We have been also considering withdrawing more annually to lower the IRA balance. I have a feeling we should have done things differently when choosing the recalculate method.
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