TTB 13:24: "However, if a spouse chooses to roll the decedent's IRA into his/her own separate IRA, any subsequent distribution will be subject to the 10% early withdrawal penalty." Why would the surviving spouse elect this when he/she could leave the IRA in the name of the deceased participants IRA? Would leaving it in the deceased name allow a subseauent withdrawal with no 10% penalty. Assuming both were under 59-1/2. Can someone clarify this?
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inherited IRAs must be either left in the deceased's name or titled 'John Doe, deceased FBO heir', and then the beneficiary must take RMDs based on their life expectancy. These distriubutions are code 4. it cannot be comingled with any other IRA. a spouse can choose to roll it into his or her own IRA, but then it is subject to penalties if withdrawn early.
why would someone do this? Not getting adequate tax advice in advance?
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