FAQ Friday: Inherited IRAs

On Friday, March 15th, Mr. Steven Berger discussed IRA’s and what happens when you inherit an IRA.

Spouses inherit IRA’s. 95% of those spouses will turn it into their own, which can be combined with their own. This is often done to avoid penalty.

An IRA that passes through a child gives an adult child 10 years to pull all the money out. If they are under 21, they have 10 years from when they turn 21 to take all of the money out.

If an IRA is left to a sibling and they aren’t less than 10 years younger than you, they use their own life expectancy to compute required minimum distributions.

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