- Jurisdiction
- Kansas
My husband passed away in 2020, I inherited 401K that he had (pretax contributions). I opened an Inherited IRA account at Fidelity and rolled over the entire amount just recently. Now I am trying to figure out how exactly I am required to take distrubutions. He was 65 when he passed, he didn't start taking any distributions when he was alive. I am a spouse who is more than 10 years younger. I am younger than 59.5
I tried to ask people at Fidelity and other people too, and their replies were more about the rollover rather than what happens after the rollover. Asked local estate planner and he also didn't clear it much. So, is it the tax law and not the company where he worked that dictates how exactly I am required to take distributions after the rollover? (the company might have limitations on how I am able to roll it over but this stage is over, I assume?)
From what I found in the internet, and I only looked at options where I can withdraw without a penalty before my age of 59.5, I have two options:
1- RMD are based on life expectancy and distributions must start no later than in the year following when he would turn 72 yo
2- 10 year method. Withdraw at any time up until 12/31 of the tenth year after the year in which the account holder died, at which point all assets need to be fully distributed (and taxes paid). Does it mean I can withdraw as I wish and how many times I wish but within 10 year term from now?
Is what I found correct? Also, am I supposed to notify anyone of which method I prefer? Must I do anything until the end of this year? thank you.
I tried to ask people at Fidelity and other people too, and their replies were more about the rollover rather than what happens after the rollover. Asked local estate planner and he also didn't clear it much. So, is it the tax law and not the company where he worked that dictates how exactly I am required to take distributions after the rollover? (the company might have limitations on how I am able to roll it over but this stage is over, I assume?)
From what I found in the internet, and I only looked at options where I can withdraw without a penalty before my age of 59.5, I have two options:
1- RMD are based on life expectancy and distributions must start no later than in the year following when he would turn 72 yo
2- 10 year method. Withdraw at any time up until 12/31 of the tenth year after the year in which the account holder died, at which point all assets need to be fully distributed (and taxes paid). Does it mean I can withdraw as I wish and how many times I wish but within 10 year term from now?
Is what I found correct? Also, am I supposed to notify anyone of which method I prefer? Must I do anything until the end of this year? thank you.