Thanks for your question. If you inherit an IRA from your spouse, there are two options. The assets can be rolled into your IRA, or transferred to an Inherited IRA. With the first option, minimum required distributions (MRDs) would be calculated using the Uniform Lifetime Table. This table assumes that MRDs would extend over two lives, yours and your spouse’s, so the MRD is lower than what it would be with the second option, an Inherited IRA, which uses the IRS’s Single Life Expectancy Table.
Let’s look at an example using the age of 78 on both the Uniform Lifetime Table and the Single Life Expectancy Table:
For the Uniform LifetimeTable: a 78-year-old person would use the life expectancy factor of 20.3.
For the Single Life Expectancy Table: a 78-year-old person would use the life expectancy factor of 11.4.
So at the age of 78, in the example, a spouse who is rolling the deceased spouse’s IRA assets into their own IRA would be required to take a smaller MRD using the Uniform Lifetime Table, than if the assets were transferred into an Inherited IRA and the Single Life Expectancy Table were used.
For some spouses older than 70½ and already taking MRDs, it might make sense to put the assets into the Inherited IRA and use the “wait until” rule. This rule allows you to delay taking MRDs for the inherited assets until the deceased spouse would have been 70½. So if your deceased spouse was younger than 70½ it might make sense to delay taking MRDs using that IRS exception.
If you have other questions about the Inherited IRA MRD rules you can visit our page:https://www.fidelity.com/retirement...
I hope this is helpful.