Calculating an Inherited IRA's RMD for a beneficiary

[RWG1950]

Assuming a person (age 90) dies in 2025 leaving an IRA with designated non-eligible benes.
Decedent had taken the 2025 RMD. Also assume a 12-31-25 balance of $100,000.
As I understand this, a bene age 85 would calculate his/her 2026 RMD from this inherited IRA using the single life expectancy table (8.1 divisor),
take yearly RMD's and must have this IRA zeroed out by the end of the10th year. Calculations indicate the 2026 RMD in this example to be $ 12,345.68.
I sometimes see slightly higher or lower RMD's quoted by certain financial institutions online calculators.
Does anyone disagree with the $12,345.68 RMD above ? Thanks for comments.

[kathyc2]

If not a spouse that inherited, I agree. Since the beneficiary is not more than 10 years younger than deceased, I don't think the 10 year rule applies.

[terryats]

The 10 year rule does not apply if 10 years younger than deceased. From IRS. Non-spouse beneficiary options Link: https://www.irs.gov/retirement-plans...cs-beneficiary


In 2020 and later, options for a beneficiary who is not the spouse of the deceased account owner depend on whether they are an "eligible designated beneficiary." An eligible designated beneficiary is

• Spouse or minor child of the deceased account holder
• Disabled or chronically ill individual
• Individual who is not more than 10 years younger than the IRA owner or plan participant

An eligible designated beneficiary may

• Take distributions over the longer of their own life expectancy and the employee's remaining life expectancy, or
• Follow the 10-year rule (if the account owner died before that owner's required beginning date)

Designated beneficiary (not an eligible designated beneficiary)

• Follow the 10-year rule

Beneficiary that is not an individual

• Follow the rules described above as if the account owner died before 2020 (because the SECURE Act changes only apply to beneficiaries who are individuals)

[kathyc2]

The 10 year rule does not apply if 10 years younger than deceased.[/LIST]

I think you meant if NOT 10 years younger than deceased.

[RWG1950]

In my example the decedent died at age 74 (not age 90) in late 2024. Not sure how I screwed up the facts on this case..
The bene is her brother-in-law age 85 in 2025.
The bene took the decedent's 2024 RMD. As I understand this, the 10-year rule will apply for the 2025 RMD and begin with the 2024 date of death.
My post was intended to confirm that the single life divisor is to be used for the bene's age 2025 RMD. At age 85 it would be 8.1 and then 7.6 in 2026.
I get confused where instructions say to use the decedent's age minus 1 for each year since the year of death. TTB PP. 13-22 13-23

[RWG1950]

The bene was actually 6 years older than the decedent, so he appears to qualify as an eligible designated beneficiary and no 10-year rule will apply.
Still am not sure which RMD table to use in this circumstance on the $108,660.27 year-end 2025 balance. The bene is 86 this year.
The Vanguard online calculator comes up with $10,250.97 RMD for 2026 which would equate to a divisor of 10.6 but I can't seem to find what table it came from.

[RWG1950]

I think I have this figured out. An eligible designated bene not more than10 years younger (6 years older in this case) would use the single life table
with the decedent's divisor at the age of death applying in first year of RMD and reducing the divisor by one for each subsequent year to calculate the RMD.

[dtlee]

I think I have this figured out. An eligible designated bene not more than10 years younger (6 years older in this case) would use the single life table
with the decedent's divisor at the age of death applying in first year of RMD and reducing the divisor by one for each subsequent year to calculate the RMD.

This is the correct way to do this.