Rich Carreiro <rlc-n...[at]rlcarr.com> wrote:
- quote -

A long time ago my wife had an IRA at Prudential that
included some mutual funds of Prudential. When we
transferred the IRA to another account, Prudential just sold
the in-house funds and transferred the cash over. Sounds
like this could be a similar situation. If Fidelity can't
hold the American Funds, they will have to be sold anyway if
they want to transfer to Fidelity.

Dennis

<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ------------------------------------------------------- >

"bono9763[at]yahoo.com" <bono9763[at]yahoo.com> writes:

- quote -

Given that these are American Funds funds, which are loaded
funds sold only through advisors, and (as far as I can tell)
you can't even get a form without talking to an advisor,
things are rather constrained.

In other words, to do it the way you say (which I agree I'd
prefer in normal circumstances), that means my relative has
to sign up with some AF-approved advisor, get an IRA-BDA
account created, and then do the transfer.

However, if it is done as a "push" instead of a "pull", AF
will send the money to Fido without my relative having to
sign up with some AF advisor.

--
Rich Carreiro rlc-news[at]rlcarr.com

<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ------------------------------------------------------- >

I think the problem arose because your relative went to the
adviser of the current account and tried to transfer it that
way. Of course there was opposition on his part to losing an
account. The easier way is to go to Fidelity, set up the
transfer IRA account in the name of deceased, for benefit of
survivor, and Fidelity will handle all the paperwork for the
direct trustee to trustee transfer of the assets.

<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ------------------------------------------------------- >

A.G. Kalman wrote:
- quote -

Whoops.... missed the point of inheriting an IRA rather
than a retirement plan. So... my answer is only correct if
one inherits a retirement plan. Then, a trustee to trustee
transfer is required to get the funds into an IRA.

<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ------------------------------------------------------- >

"A.G. Kalman" <sfcnm-mtm[at]yahoo.com> writes:

- quote -

This is a plain old IRA with named beneficiaries,
not a qualified plan.

--
Rich Carreiro rlc-news[at]rlcarr.com

<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ------------------------------------------------------- >

"A.G. Kalman" <sfcnm-mtm[at]yahoo.com> wrote:

- quote -

Wrong reference. This provision has to do with 401(k)
non-spouse beneficiaries, who previously had no transfer
ability and stricter distribution timeframes. The OP has to
do with IRAs, which have had more liberal treatment for
non-spouse beneficiaries for some time and, AFAIK, are
mandatory for the "losing" custodian.

--
Phil Marti
Clarksburg, MD

<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ------------------------------------------------------- >

rlc-news[at]rlcarr.com (Rich=A0Carreiro) posted:

- quote -

Yes, I believe so.

- quote -

Simply by visiting the irs website --

[from http://www.irs.gov/publications/590/ch01/]

-- you can copy the following:

<snipInherited from someone other than spouse. =A0=A0If you
inherit a traditional IRA from anyone other than your
deceased spouse, you cannot treat the inherited IRA as your
own. This means that you cannot make any contributions to
the IRA. It also means you cannot roll over any amounts into
or out of the inherited IRA. However, you can make a
trustee-to-trustee transfer as long as the IRA into which
amounts are being moved is set up and maintained in the name
of the deceased IRA owner for the benefit of you as
beneficiary. =A0=A0Like the original owner, you generally
will not owe tax on the assets in the IRA until you receive
distributions from it. You must begin receiving
distributions from the IRA under the rules for distributions
that apply to beneficiaries.
<snip
That seems pretty definitive. There is a cross reference to
other sections regarding calculations for the RMD (Required
Minimum Distributions), which, for a beneficiary other than
spouse, can mean determining life expectancy for the
year-following-death, and thereafter, so even a younger
person could be forced to take RMDs at age 53 (in one
example) -- which, logically, is the reason for not
permitting any "rollovers" which might blur the status and
mingling funds with the beneficiary's IRA.

But your friend or you can easily review the entire Pub 590
-- either online (as I just did) or by downloading pdf or
arrange to get a hard copy from IRS.

Bill

<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ------------------------------------------------------- >

Rich,

The section on "inherited IRAs" in publication 590 covers
what you need.

I believe the AF guy is confusing non-spouse and spousal IRA
inheritance. I haven't looked at 590 in a while, but I
believe spousal inheritance allows for rollovers, but
non-spousal IRAs only allow for direct trustee-to-trustee
transfers. The reasoning is thus: a IRA inherited from a
spouse can be treated as your own, with all the same
benefits extended to the original account owner. A
non-spousal inherited IRA CANNOT be treated as your own. No
further contribs can be made, no rollovers are allowed
(except DT2T), and you are subject to the numerous
distribution rules (which vary depending on whether the
decedent had reached the required beginning date or not).

<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ------------------------------------------------------- >

Rich Carreiro <rlc-news[at]rlcarr.com> wrote:

- quote -

Yes.

Forget about the 60-day rule.

A direct transfer from the old account. 50% of the old
account should go into a new account titled "Jane Doe as
beneficiary of John Doe IRA" and she would take
distributions based on her age and add "1" to the Pub 5
table denominator every year.

--
ArtKamlet at a o l dot c o m Columbus OH K2PZH

<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ------------------------------------------------------- >

Rich Carreiro wrote:

- quote -

Sec. 829 of the Pension Protection Act of 2006 added Sec.
402(c)(11) to Title 26. See IRS Notice 2007-07 for details
and a Q&A. A direct trustee to trustee transfer is required.
Especially read Q&A 14 which states that a plan does not
have to offer this option.

<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ------------------------------------------------------- >

A relative of mine has just inherited a share of a trad IRA
and a Roth IRA from her father. The IRAs listed her and her
sister as 50/50 beneficiaries.

I'm trying to make sure my relative (the decedent's
daughter) doesn't get hosed on this...

She's contacted her late father's financial advisor (who
works with American funds -- her dad's trad and Roth IRA
accounts are with American). The advisor is trying like heck
to discourage my relative from transferring her share of the
inherited IRA to an inherited IRA account at Fidelity (which
is where all her other investments are kept).

Anyhow, after finally and politely getting the advisor to
admit defeat, he said she could do a "60-day rollover" to
get the money into the inherited IRA account at Fido. She
has NOT signed off on that yet.

I am under th impression that this could not be done -- if a
check made payable to her is sent, it'll (a) all be taxable
income (except from the funds from the Roth), and (b) it
will not be able to be put back into inherited IRA accounts.
In other words, only a direct trustee-to-trustee transfer
will do the trick (which could involve a check, as long as
the check is made out to "Fidelity FBO [whatever]" and not
to my relative).

Is my understanding correct?

And if so, could you point to pubs/regs/IRC that states
this, so I can give that reference to my relative so she can
in turn quote it at the advisor.

Thanks!

--
Rich Carreiro rlc-news[at]rlcarr.com

<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ------------------------------------------------------- >