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Multiple Beneficiaries and the Year of Death RMD

Contributor Natalie Choate navigates through the complexities.

When multiple beneficiaries inherit investment retirement accounts, it can be dicey to figure out the required minimum distribution obligations.

Situation #1
Father, age 78, dies in 2019 without having taken the 2019 RMD from his IRA. We know the beneficiary(ies) of the account must take that RMD no later than Dec. 31, 2019. But which beneficiary(ies)? The beneficiary designation reads, “I leave $100,000 to My Favorite Charity, and the balance of the IRA equally to my two children.” The amount of Father’s 2019 RMD is $75,000. If the $100,000 charitable gift is distributed out of the IRA to My Favorite Charity prior to the end of 2019, is the RMD satisfied? Or does each beneficiary have to receive some part of the RMD?

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