participant under 72 dies, beneficiary is over 72 - RMD?

A 63-year-old active participant died in 2022.  Her 75-year-old spouse is trying to roll the balance to an IRA.  The product platform is saying that an RMD must be taken first.

Looking at 1.401(a)(9)-5 Q&A 5, it seems that there is a catch.  The way I'm reading it, it talks about the calculation for the year after the year of the participant's death... but nothing for the year OF the participant's death.  Does that mean that there's a "free year"?  I can kind of justify that, since as of 12/31/21, there was no RMD to be calculated for 2022.  Or am I just reading into it what I want to see?

Of course, if the product says "we're making the beneficiary do an RMD because that's how we do it, period", then that's the way it goes, but since we do non-product plans, I figured I'd see if I was at least taking a reasonable position (in case this comes up again, which I hope it never does).  Thanks.

I think (and I say think, cause I'm not sure - the SECURE Act confused this stuff, and I've been fortunate enough not to have a real case yet) that there is no RMD. Assuming the spouse is the 100% beneficiary, I believe the surviving spouse can roll over the entire amount, and does not have to take RMD's until 12/31 of the year the participant would have attained age 72, even though in this case that means no RMD's until the surviving spouse is about 87. Seems like a crazy result, but that's my "memory" on this. 

But, as I said, that's based on memory and I haven't specifically researched it. Probably wrong...Good luck!

The participant has not reach RBD so no RMD is due for 2022 under any set of rules that I'm aware of, if the product insists, have them produce a citation for their position that is more than "because we said so".

What the plan allows on death and what elections the spouse makes will determine when RMDs must start for the spouse. My memory matches up with Belgarath with pretty much the same caveats about SECURE Act changes possibly clouding the issue.

I "think" to extend the RMDs as long as possible the spouse could roll the funds to an Inherited IRA and delay RMDs until the participant would have reached age 72. I believe this part of SECURE changes is the same as pre-SECURE for spousal beneficiaries.

If she elects to treat the IRA as her own, then RMDs would begin the first year following when she has a balance on 12/31 of the preceding year. So if she roll it to an IRA in 2022 in her name, then RMDs would start in 2023.

If the money is left in the Plan, RTD on options available and payout timelines for beneficiaries.

Agree with you both.

No 2022 RMD under any scenario.

Keep in plan, subject to plan provisions but very likely no RMD until participant's RBD.

R/O to inherited IRA, no RMD until participant's RBD.

R/O to own IRA, RMDs begin 2023 based on spouse age.

And if the company/product wanting my R/O was insisting on the plan paying an RMD first, I would find someone more knowledgeable of the rules to take my money thank you very much.

I asked for an escalation to the platform's compliance dept.  Good news - they agreed that no RMD is necessary.

Hysterical news - the platform asked why we initiated the request for the RMD in the first place! LOL

Thankfully, as the spouse is requesting a rollover of the full balance, I won't have to worry about any RMDs for 2023.