Rollover contribution to Inherited IRA

[Guest Shelton]

If a spouse inherited qualified plan assets from his/her spouse, can he/she roll those assets to an inherited IRA?

Or can he/she only roll those assets to his/her own IRA?

[Dawn Hafner]

This is exactly the question I am researching. Any answers found?

I did see one posting referring to the fact that 408(d)(3)© rollover rules regarding inherited IRAs does not stipulate that the RO be done to the beneficiaries IRA.

[BPickerCPA]

It's my belief that a spouse beneficiary of a decedent's qualified plan can roll the plan assets into an IRA in the decedent's name with the spouse remaining as the beneficiary. The question is whether it needs to be a pre-existing IRA or can the spouse create a new IRA in the decedent's name.

You might need to get a private ruling in any event because without clear cut permission, you might have trouble finding a custodian willing to do it.

[Appleby]

Dawn,

I do not understand your statement. However, 408(d)(3)© “ Denial of Rollover Treatment” does stipulate that rollover contributions may not be made to inherited IRAs. Since the movement of assets from the QP to the IRA must be done as a direct rollover, then it cannot be done to an inherited IRA.

Barry, I have seen a TAM that permitted such a transaction--- can’t seem to locate it now though- my notes says the number is TAM-653, but obviously I need the full number to locate the document. In any event, you are right- I am not aware of an IRA custodian that would permit a spouse to establish an IRA in the deceased spouse’s name- except if the IRA was an inherited IRA, established in both the deceased and beneficiary’s name, using the TAX ID number of the beneficiary. .