Have you inherited an IRA from a non-spouse after 2019? The Secure Act says that apart from a few exceptions, funds must be totally distributed from these accounts 10 years after the decedent’s death.
In addition, the IRS surprised everyone in February 2022 by ruling that if the decedent who passed away after 2019 was required to take distributions, the beneficiary/s who must liquidate the account in 10 years must also take required minimum distributions in year 1-9 until the account is fully distributed. This gave rise to a lot of criticism and subsequently the IRS ending up waiving this requirement in 2020, 2021, 2022. and 2023.
Yesterday, in Notice 2024-35, the IRS said they would also waive this requirement again in 2024.
Will they do this each year, or is this the last grace from taking the RMD? No one knows for sure. We will have to wait and see.
Also, just because there is no RMD for 2024, it does not mean all people with Beneficiary IRAs should not make a distribution. It all depends on your overall financial and tax situation. At least now there is a choice.
