Q:

What are some distribution choices available to IRA beneficiaries?

A:

Quick Answer

The types of distributions available to IRA beneficiaries depend on the beneficiary’s relationship to the account owner and the age of the account owner at the time of death. Available distributions include a lump sum or payments scheduled over five years or the beneficiary's expected lifetime, according to Charles Schwab.

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Full Answer

Spouses who inherit an IRA can transfer the funds to their own IRA, regardless of the age of the deceased, Charles Schwab notes. When a surviving spouse prefers to take a distribution, the age of the deceased affects the type of distribution. If the spouse was younger than 70 1/2 at the time of death, the beneficiary can select any of the three distribution methods. If the spouse was older than 70 1/2, the beneficiary must choose a lump sum or a life-expectancy distribution. Non-spouse beneficiaries must select a distribution method, and they can’t transfer the funds to their IRA.

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