U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Retirement
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
 
Old 12-28-2017, 02:06 PM
 
Location: Charleston, SC
1,362 posts, read 768,046 times
Reputation: 2428

Advertisements

I don't know the details on Roth IRA beneficiaries. Is it better to name my Dear Daughter as Primary Beneficiary on my Roth ?? Or would she be forced to start taking Inherited RMD's out of it right away ??


I guess a better question to ask is -- is it a good idea to name a young person as Beneficiary to any account that is affected by RMD's.

I'm going over some of these year-end details, now is a good time to check this aspect.
Reply With Quote Quick reply to this message

 
Old 12-28-2017, 02:18 PM
 
Location: Omaha, Nebraska
7,319 posts, read 4,164,649 times
Reputation: 18334
Just because someone would need to take RMDs on inherited money is no reason not to leave it to them! And as long as you've held the Roth IRA for at least 5 years, your daughter would owe no income tax on the required RMDs.

Roth IRA Beneficiary Rules | RothIRA.com

(Bear in mind that tax laws can change greatly between now and when you die, so estate planning is never a "once and done" deal.)
Reply With Quote Quick reply to this message
 
Old 12-28-2017, 03:26 PM
 
Location: Charleston, SC
1,362 posts, read 768,046 times
Reputation: 2428
"If you name one or more people other than your spouse as a beneficiary, they will need to withdraw a minimum amount each year."

Website says they will have to start taking a minimum amount, but since I've held this acct for over 5 years -- DD will not have to pay taxes. That makes sense.....it's a tax-free generational inheritance.

Thanks, I'm thinking about updating this. I don't want to boost the Kid into a high tax bracket.
Reply With Quote Quick reply to this message
 
Old 12-28-2017, 04:05 PM
 
Location: Omaha, Nebraska
7,319 posts, read 4,164,649 times
Reputation: 18334
You won't be boosting your daughter into a high tax bracket because you name her as a beneficiary on your Roth IRA - but even if you did, so what? She'd be in a higher tax bracket because she'd have more money coming in, and more money coming in is generally a good thing! That's like saying "I wouldn't want to win the lottery because it would put me in a higher tax bracket." Even after paying the taxes, you'd have more money at the end of the year than you had at the start of it.

As the law currently stands, though, she'd owe no Federal income taxes on those RMDs, and could take the money and just reinvest it if she didn't want to spend it. So it's a good deal.
Reply With Quote Quick reply to this message
 
Old 12-28-2017, 05:17 PM
 
Location: Charleston, SC
1,362 posts, read 768,046 times
Reputation: 2428
Thanks for the link to the Roth rules. I must point out that there's a big difference between winning the Lottery and the value of my Roth.....HA-HA !!
Reply With Quote Quick reply to this message
 
Old 12-28-2017, 05:34 PM
 
Location: Wisconsin
21,541 posts, read 44,028,155 times
Reputation: 15150
Roth money isn't taxable. I'd be more concerned about them exhausting the funds too early. As stated above, better they reinvest those withdrawals. I figure about the time my son/dil draw on my IRAs, they will be retired. My only concern is going too soon and them not handling the 'premature' withdrawals wisely. Neither, as yet, has a significant appreciation of present value vs. future value.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Retirement
Follow City-Data.com founder on our Forum or

All times are GMT -6.

2005-2019, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top