In 2003 I inherited my brother’s 401(k) and T-IRA. I rolled the 401(k) over into a T-IRA, and have since reorganized all these inherited retirement assets multiple times, and they are now in T-IRAs with three different custodians.
My memory of the rules from when I last reorganized in late 2017 is that trustee-to-trustee transfer must be used, rather than rollover. Is that still true?
And can the same portion be transferred more than once per year?
What I would like to do now is consolidate the IRAs now with custodians A & B into that now with custodian C; and then divide the whole thing up among entirely different custodians in different proportions.
This topic was modified 2 years, 2 months ago by wanttoknow.
Yes, you recall correctly. Change of custodian on a non spouse inherited IRA can only be done by direct non reportable trustee transfer, but there is no limit on the number of these you can do. Be very careful to avoid requesting anything that could be construed as a distribution request, since a check made out to you will be fully taxable with no fix available for this.
Also, when consolidating to C be sure that all these accounts were inherited from the same decedent AND have the same RMD divisor. Finally, if inherited from the same decedent, your RMDs can be aggregated, although consolidating to one account would make that irrelevant.