Reply To: Non Deductible IRA

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Alan S.

There is no deadline to request a direct rollover to your own IRA, however it should be done before year end or your 2020 401k RMD will be larger than the RMD from your IRA if you rollover it over to an IRA this year.

Another benefit of doing this rollover is the RMD treatment of YOUR beneficiaries after you pass. If you leave this as an inherited 401k account, their RMDs would have to continue based on your age instead of being based on their presumably younger ages.

When you say that both the IRA and the 401k were transferred to your name only, since you cannot be the owner of the 401k, only a beneficiary, this suggests that all of these accounts merely list you as the beneficiary of your husband including the IRAs. Again, you cannot become the owner of an inherited 401k, you can only continue as beneficiary. You CAN become the owner of an IRA inherited from your spouse. Therefore, you should get the 401k rolled over to an IRA titled with you as the owner. When all is completed you would own just one IRA combining all these accounts into a single owned IRA.

If the 401k accounts are administered by the same firm, that might explain their error with the 2019 RMD. Is your IRA also with that firm, or with another firm?