The pending Setting Every Community Up for Retirement Enhancement (SECURE) Act will be a game changer when it comes to required minimum distributions (RMDs), and alert practitioners will find ways to adjust. Past years’ themes continue to appear in court opinions, as well as in private letter rulings.
SECURE Act
The SECURE Act was introduced and passed in the House of Representatives, but the Senate has yet to take it up.1 The bill would change rules for contributing to retirement savings plans and accounts, as well as for RMDs.
Those over age 70½ would be permitted to make contributions to individual retirement accounts but wouldn’t be permitted to use post-age 70½ contributions to fund qualified charitable distributions.
The time when a plan participant or IRA owner must generally begin taking RMDs would start when age 72 is attained, instead of age 70½.
RMDs after death would change dramatically. Generally, instead of stretching out distributions over the life expectancy of the designated beneficiary (if there is one), all amounts standing in a decedent’s account would be distributed and taxed within 10 years of the year when the plan participant or IRA owner died. However, the rules for a surviving spouse will be unchanged, and a surviving spouse’s ability to make a rollover to her own IRA will also remain in place.
Exceptions to the 10-year rule are provided for certain beneficiaries, including: those who are less than 10 years the deceased participant’s junior; a disabled or chronically ill individual; and a child, but only until he reaches the age of majority. Possibly, a trust could meet any of the requirements, but the proposed legislation doesn’t address that point.
Defined benefit plans are nowhere mentioned in the proposed legislation.
The economic loss to death beneficiaries subject to the 10-year rule versus lifetime stretch distributions would be significant. Naming a charitable remainder trust might greatly increase value compared to the application of the proposed 10-year rule.
For example, an IRA owner who named his son as the IRA’s death beneficiary dies at age 85. At the time of his father’s death, the son is age 50. The value of the son’s inherited IRA is $500,000. If the son immediately withdraws the account and pays income taxes at an effective rate of, say, 45% (federal and state combined), the son’s net after-tax value is $275,000.
If the son instead waits 10 years and then withdraws the entire account, and assuming that the rate of investment return inside the inherited IRA is 7% and that the son’s after-tax rate of return is 3.9%, the son’s after-tax net present value is $370,771—an improvement of $95,771 over immediate withdrawal.
Now, assume that the IRA owner establishes and names as the IRA’s beneficiary a testamentary charitable remainder unitrust (CRUT), paying the son 5% of the trust’s value each year (5% unitrust) for life, assuming that the CRUT earns an annual return on investment of 7% and makes payments to the son at the end of each year. Assuming the son lives to age 87, the present value of the son’s payments at the time when the CRUT is funded is $668,811—an improvement of $393,811 over immediate withdrawal. In addition, the present value of the charity’s remainder interest is $81,132 (7% discount rate assumed, because neither the CRUT nor the charity pays income taxes). The after-tax value to the son and charity combined is $749,943.
New Tables Proposed
Even as the SECURE Act seeks to increase the age when RMDs must commence, Treasury has proposed to update the tables used to determine RMDs by incorporating mortality tables reflecting longer life expectancies.2 The proposed regulations (proposed regs) would extend the number of years for making distributions from qualified retirement plans, IRAs and annuities and certain other tax-favored employer-provided retirement arrangements. The result: lower RMDs for all ages and greater deferral of income taxes, thereby assuring a more secure retirement.
For example, the present table that applies to single individuals extends to age 111. The proposed replacement table extends to age 120. On adoption as a final regulation, RMDs will decrease for all plan participants and surviving spouses whose applicable distribution periods are redetermined each year.
The proposed regs include specific examples. In one, a 70-year-old IRA owner who uses the Uniform Lifetime Table to calculate RMDs must use a life expectancy of 27.4 years under the existing regulations. The proposed regs would require use of a life expectancy of 29.1 years.
That change can produce a significant RMD reduction. Assuming, for example, an account value of $250,000, the RMD would be $8,591 instead of $9,124 —a reduction of $533, or about 6%.
As another example, a 75-year-old surviving spouse using the Single Life Table to compute RMDs must use a life expectancy of 13.4 years. Under the proposed regs, the spouse would use a life expectancy of 14.8 years.
Year When Income Tax Applies
The Internal Revenue Service issued Revenue Ruling 2019-19, holding that a distribution from an IRA is taxable income to the distributee in the tax year when the distribution is received.3 The ruling addressed the following question: What happens if a check is mailed by a retirement plan’s administrator to the participant towards the end of 2019; is received by the participant in 2019; and isn’t cashed until 2020? The plan administrator issues Form 1099-R, reporting the distribution as having occurred during 2019. The revenue ruling held that the income is taxable in 2019, finding that the recipient’s delay in cashing the check isn’t controlling. The plan administrator’s obligations to withhold income tax and report the distribution for 2019 aren’t affected by the date on which the check was cashed.
The Treasury and the IRS intend to consider other situations involving uncashed checks, including those sent to missing payees. But, there’s no mention of addressing the situation in which a check isn’t delivered to a payee’s mail until after the year in which the check was sent.
Sixty-Day Waivers
In an Advance Release, the IRS provided answers to frequently asked questions relating to waiver of the 60-day rollover period that applies to IRAs and employer-sponsored qualified plans.4 Late rollovers may be made when: the taxpayer is entitled to an automatic waiver of the 60-day rollover requirement; a private letter ruling waiving the 60-day requirement is obtained; or the taxpayer qualifies for and uses the self-certification procedure for a waiver of the 60-day requirement.5 The Advance Release outlines each option. It also acknowledges that IRA custodians may refuse to recognize self-certification, which, as the Advance Release reminds us, may be addressed by moving the account to another IRA custodian or trustee.
Income Tax Deduction Denied
In Schermer v. Commissioner,6 the Tax Court considered whether Jill Schermer, the surviving spouse of Robert Schermer, could claim an income tax deduction for estate taxes paid.
Jill was the death beneficiary of several items Robert had accumulated: an annuity paying her $174,832; an IRA paying her $44,705; and a second IRA paying her $50,000. Jill received each of those items during 2014 and reported them on her income tax return.
Jill also claimed an income tax deduction for estate taxes paid. Such a deduction may be claimed when estate taxes were paid on income in respect of a decedent (IRD).7 Jill would have been entitled to claim the deduction had Robert’s estate paid estate taxes. But, Robert’s estate paid no estate taxes; instead, Jill deducted estate taxes paid by her father-in-law’s estate. Because those estate taxes bore no relationship to the retirement accounts and annuity includible in Robert’s estate, the court held she wasn’t entitled to any income tax deduction for her father-in-law’s estate taxes.
Completion of Rollover Timely
In Burack, et ux v. Comm’r,8 Nancy Burack sold her home and bought another one. But, the sale wasn’t going to close in time for her to close on her new home.To bridge that financial gap, she withdrew $524,981.89 from her IRA, intending to complete a rollover within 60 days. Her IRA custodian was identified in the court opinion as “Capital Guardian, LLC/Pershing, LLC, 3.”
Fifty-seven days later, Nancy received a Chase Bank cashier’s check made out to “PERSHING FBO NANCY J. BURACK” in the amount of $524,981. Although her financial advisor suggested sending the check overnight to be deposited in a Pershing IRA held in her name, she instead sent the check overnight to Capital Guardian, on Day 57. She did so on Capital Guardian’s assurance that she could redeposit the distribution there.
But, her check was deposited in her Pershing IRA on Aug. 26, 2014—two days past her 60-day rollover period. The court stated that what happened between those two dates was “not entirely clear.” The court did note that: all communications were between Nancy and Capital Guardian; Capital Guardian provided all documentation entered into the record; and no communications occurred between Nancy and Pershing. Accordingly, the court found that Capital Guardian was an appropriate institution to which Nancy could send the check issued to her.
The court also found that Nancy’s Capital Guardian IRA statement showed receipt of the check 58 days after the date when the IRA distribution occurred.
Because the court so found, it also found that the IRA rollover was timely.
In addition, the court noted that under IRC Section 408(d)(3)(I), the Treasury had authority to extend the 60-day rollover deadline for hardship. Observing that the requirements for granting an automatic waiver set forth in Revenue Procedure 2003-16 had been met, this was additional grounds for recognizing that a valid rollover occurred. When Rev. Proc. 2003-16 applies, a taxpayer has up to one year to complete a rollover.9
Use of Funds Not Relevant
In Lilly Hilda Soltani-Amadi v. Comm’r,10 Lilly withdrew funds from her IRC Section 401(k) account (401(k)) and used those funds to purchase a residence for herself and her husband. No rollover contribution occurred after that.
The couple represented to the court that they had been advised by their investment representative that the full penalty doesn’t apply to first-time home buyers. They further asserted that: the penalties and fees were too high; they were first-time home buyers; the house was a form of retirement money; and because the cash went directly towards their house, the house was like a savings for them when they get old. Finally, they pleaded: “We just need a break. We have worked very hard and put ourselves through school. We could use a break.”
Not surprisingly, the court found that nothing in the petition overcame the government’s claim that a taxable distribution had occurred and that tax was owed on the distribution. Furthermore, because the couple was under age 59½ when the distribution occurred, the 10% early withdrawal tax under IRC Section 72(t)(2)(F) applied. The court noted that the penalty doesn’t apply to an IRA withdrawal used to purchase a taxpayer’s first residence, but, here, the funds didn’t come from an IRA.
Failure to Make Loan Payments
In Gerald McEnroe v. Comm’r,11 Gerald was a participant in a pension plan sponsored by New York City School Construction Authority (SCA), his employer. The plan was named the New York City Employee Retirement System (NYCERS).
During July 2014, Gerald took out a loan from his plan account. From inception, Gerald timely made loan payments through payroll withholding. He stopped making loan payments after he resigned on May 15, 2015 to accept a job in the private sector.
It wasn’t long before he went back to SCA. After that, Gerald learned that SCA determined his loan was in default, with the result that the loan balance would be treated as a taxable distribution. He sought a solution through SCA’s human resources office, which sent a letter to NYCERS on his behalf. NYCERS responded, saying it would process a revision, “and it will be done by 11/20/15.”
During December 2015, loan payments via biweekly payroll withholding were restarted. But, he never made any of the loan payments that were then in arrears.
To Gerald’s surprise, he was sent Form 1099-R showing a taxable distribution of $22,284, the loan balance as of June 24, 2015. That income was omitted from his income tax return.
The IRS assessed income taxes, as well as the 10% tax on pre-age 59½ distributions under Section 72(t).
Gerald petitioned the Tax Court to overturn the tax assessment, but the court held for the government, finding that “NYCERS properly concluded that Mr. McEnroe had defaulted on the loan during the year in issue and correctly reported his entire loan balance at the time of the default ($22,284) as a deemed distribution.”12 The court also upheld assessment of the 10% tax on early distributions.
No PLR
In an information letter, the IRS advised a taxpayer that it was refusing to issue a PLR.13 The taxpayer requested a PLR regarding whether the beneficiary of a decedent’s estate may receive RMDs from the decedent’s account in a 401(k) plan in accordance with IRC Section 401(a)(9). The information letter stated that the IRS won’t issue a PLR with respect to an issue that’s clearly and adequately addressed by statute and regulations, citing Rev. Proc. 2018-1, at Section 6.11.14 The IRS advised in a separate letter that the taxpayer’s user fee would be returned. The information letter summarized the relevant provisions of the IRC and regulations but stated no conclusions. The taxpayer was advised that additional information is available in Publication 590-B, “Distributions from Individual Retirement Arrangements (IRAs).”
Rollovers by a Surviving Spouse
Several PLRs confirmed that a surviving spouse could roll over retirement benefits of a deceased spouse to an IRA treated as the surviving spouse’s IRA.
In PLR 201902023 (Jan. 11, 2019), a settlor formed a trust during lifetime and named a subtrust created under that trust as the death beneficiary of an IRA. The subtrust became irrevocable when the settlor died. The settlor died after reaching his RMD’s required beginning date (RBD), by which time IRA distributions in accordance with RMD rules had begun.
Under the terms of the trust, all distributions received by the trust from the deceased settlor’s IRA were required to be immediately paid over to the surviving spouse. The trust also provided that, following the death of the settlor’s surviving spouse, the settlor’s children or his descendants as successor beneficiaries were entitled to the trust’s inherited IRA.
The PLR concluded that, because all IRA distributions to the trust were required to be immediately paid over to the surviving spouse for life, and because the surviving spouse was the younger spouse, the applicable distribution period for the decedent’s IRA is based on the life expectancy of the surviving spouse. In addition, the applicable distribution period for determining each year’s RMD could be redetermined each year, using the surviving spouse’s birthday for each distribution calendar year after the calendar year of the decedent settlor’s death, up through the calendar year of the spouse’s death. Beginning with the calendar year after the year of the spouse’s death, the applicable distribution period will be the spouse’s life expectancy, using the spouse’s age each year, through the calendar year of the spouse’s death. After the year of the spouse’s death, the applicable distribution will be reduced by one for each calendar year that’s elapsed after the calendar year of the spouse’s death.
In PLR 201901005 (Oct. 10, 2018), an IRA became payable to a trust after the IRA’s lifetime owner died because that trust was named as the IRA’s beneficiary. Trust beneficiaries included the decedent’s spouse, child and two grandchildren. No contingent beneficiary was named. Within nine months of the decedent’s death, all trust beneficiaries made disclaimers of the IRA, including the account owner’s surviving spouse, son, grandchildren and the trustee. They represented to the IRS that, as a result of the disclaimers, the decedent’s estate became the account’s beneficiary, and the surviving spouse became entitled to the account. The IRS ruled that the surviving spouse could roll over the proceeds of the decedent’s account to an IRA treated as an IRA of the surviving spouse.
In PLR 201923002 (June 7, 2019), a decedent’s IRA was payable to a trust. The decedent’s surviving spouse was sole trustee of that trust. The terms of the trust granted the surviving spouse a right to withdraw the trust’s net income and/or its principal. The trust also granted the spouse the right to modify, amend or revoke the trust at any time, as well as sole authority and discretion to distribute the IRA’s proceeds to herself at any time.
The PLR confirmed that the surviving spouse could elect to treat the decedent’s IRA as her own and could effect a rollover to her own IRA, provided that the spouse completes the rollover within 60 days of the date when the decedent’s IRA was distributed. But, the surviving spouse was warned that the amount of the rollover can’t exceed the taxable portion of the distribution, citing IRC Sections 408(d)(3)(A) and (B). In addition, if the decedent had any basis from nondeductible contributions made during lifetime, that amount can’t be rolled over.
The PLR didn’t disclose whether the decedent had reached his RMD’s RBD. If he had, then, the surviving spouse couldn’t have rolled over any amount of the decedent’s RMD for the year of death.
A direct trustee-to-trustee transfer from the decedent’s IRA to the surviving spouse’s IRA is preferable, because that avoids the risk of violating the 60-day rollover deadline.
In PLR 201931006 (Aug. 22, 2019), an IRA owner failed to designate a death beneficiary for his IRA, with the result that pursuant to the terms of the IRA’s adoption agreement, the IRA owner’s estate became entitled to the account.
The IRA owner died intestate. But, under applicable state law, the decedent’s surviving spouse became entitled to the decedent’s entire estate, including his IRA. In addition, the surviving spouse served as executor of the deceased spouse’s estate.
The surviving spouse intended to distribute the IRA to the estate and pay the proceeds over to himself. The surviving spouse sought to roll over the proceeds to an IRA that would be treated as an IRA of the surviving spouse. The PLR stated that the surviving spouse would be eligible to roll over the proceeds from the deceased spouse’s IRA to an IRA set up and maintained in the surviving spouse’s own name, as long as the rollover occurs no later than 60 days after the proceeds are received by the surviving spouse in his capacity as administrator of the deceased spouse’s estate.
In PLR 201934006 (Aug. 23, 2019), a deceased IRA owner named his children as death beneficiaries of his account. But, the owner’s surviving spouse became entitled to the account under a court order and so was entitled to withdraw unlimited amounts from the IRA. The IRA owner died after the time when RMDs had to commence.
The PLR observed that, under Treasury Regulations Section 1.408-8, Q&A-5, when an IRA owner’s spouse is the sole beneficiary and has an unlimited right to withdraw amounts from the IRA, the surviving spouse is entitled to make a rollover.
In this case, the IRS recognized the court order as having satisfied those requirements.
In PLR 201935005 (May 23, 2019), a married IRA owner died before reaching his RMD’s RBD. An individual other than his surviving spouse was named as death beneficiary. The surviving spouse sought and obtained a court order holding that she was the account’s death beneficiary. The account’s custodian retitled the IRA as an IRA of the surviving spouse. The surviving spouse represented to the IRS that she remained as beneficiary and had an unlimited withdrawal right.
The IRS ruled that the surviving spouse could roll over the decedent’s IRA to one treated as an IRA of the surviving spouse within 60 days of withdrawing funds from the decedent’s account.
In PLR 201936009 (Sept. 16, 2019), a decedent who had been a state employee and a participant in his employer-sponsored retirement account named his estate as death beneficiary of his account. The plan governing the account met the requirements of IRC Section 457. The decedent’s surviving spouse, who served as his estate’s sole executrix, was the sole beneficiary of the decedent’s estate.
The surviving spouse sought to roll over the decedent’s account to an account of the surviving spouse, but the “record keeper for the plan” wouldn’t facilitate the rollover because the estate, and not the surviving spouse, was named as sole beneficiary.
The IRS confirmed that the surviving spouse could nevertheless do so.
Direct Transfers After Death
In PLR 201909003 (March 1, 2019), an IRA owner died after reaching the RBD for RMDs. The account owner failed to name a death beneficiary. The account owner wasn’t married at the time of his death but was survived by “nonspousal beneficiaries.” His estate was entitled to the account under his last will and testament. Pursuant to the terms of his will and under a probate court order, the estate was divided among nonspousal beneficiaries, each being entitled to an equal share of the decedent’s IRA. Direct transfers were made from that IRA to each estate beneficiary’s inherited IRA.
The IRS ruled that each beneficiary could set up an inherited IRA to receive a direct, trustee-to-trustee transfer from the decedent’s IRA to each beneficiary’s inherited IRA, thereby avoiding recognition of taxable income and preserving the right to make future IRA withdrawals over the remaining applicable distribution period, based on the age of the decedent. In arriving at its conclusions, the PLR relied on Revenue Ruling 78-406, holding that the direct transfer of funds from one IRA trustee to another, even if at the behest of the IRA holder, doesn’t constitute a payment or distribution to a participant, payee or distribute, as those terms are used in Section 408(d). Furthermore, such a transfer doesn’t constitute a rollover distribution. Rev. Rul. 78-406 is applicable if the trustee-to-trustee transfer is directed by the beneficiary of an IRA after the death of the IRA owner, as long as the transferee IRA is set up and maintained in the name of the deceased IRA owner for the benefit of the beneficiary.
The PLR also observes that the IRA constitutes IRD under IRC Section 691 and so is subject to income taxes in the hands of each individual entitled to a share of the IRA—in this case, the estate’s beneficiaries.15
The PLR didn’t mention that IRC Section 691(c) permits an income tax deduction for estate taxes attributable to IRD. There’s no authority regarding what portion of each IRA distribution is IRD. At a minimum, only distributions of principal (the balance of the account as of the IRA owner’s date of death) should be so classified. One approach might be to determine the ratio of estate taxes to the IRA’s date-of-death value and apply that ratio to each year’s distribution of principal. Another approach is to claim a deduction each year equal to the amount of principal distributed, until the deduction is fully used, and it could be assumed that the amount of any year’s principal distribution is the difference between the amount of that year’s distributions and all of that year’s realized income and gains.
The holdings in PLRs 201924013 (June 14, 2019) and 201927009 (July 5, 2019) are similar to PLR 201909003, confirming that direct transfers may be made from an estate or a trust to inherited IRAs of the estate’s or trust’s beneficiaries.
Surviving Spouse
In PLR 201923016, a Roth IRA owner died after reaching his RBD for RMDs.16 He was survived by his spouse and daughter. The surviving spouse was older than the IRA owner. The daughter was younger than the surviving spouse (it wasn’t stated whether the spouse was the daughter’s parent).
The decedent was, during lifetime, the settlor of a revocable living trust that became irrevocable on the settlor’s death. At that time, the trust divided into three subtrusts: a marital deduction subtrust (Marital Trust), a subtrust for the benefit of Daughter (Daughter’s Trust) and a third family subtrust. The Marital Trust met the definition of “qualified terminable interest property” under IRC Section 2056(b)(7) and thus the surviving spouse was entitled to all Marital Trust income for life. The PLR doesn’t state how distributions from the Roth IRA to the Marital Trust were to be allocated between trust income and principal.
The surviving spouse was the primary beneficiary of the Marital Trust. After the surviving spouse dies, all Marital Trust property would pass to a subtrust benefiting the decedent’s daughter.
For purposes of determining the designated beneficiary over whose life expectancy RMDs from the Roth IRA could be made, the trust defined “Designated Plan Beneficiary” to mean the oldest individual beneficiary of such subtrust, determined as of Sept. 30 of the calendar year following the decedent’s death. Because the decedent’s spouse survived the decedent, and because the spouse was older than the decedent’s daughter, the surviving spouse appeared to be the designated beneficiary. But, an independent trustee could modify the trust provisions, causing the Marital Trust to accumulate Roth IRA distributions instead of immediately paying those distributions over to the surviving spouse. If that modification occurs, the trust limits the set of beneficiaries who may possibly receive any proceeds of Roth IRA distributions to individuals who are younger than the Designated Plan Beneficiary.
The trust required that retirement benefits paid to each subtrust be paid outright to each subtrust’s Designated Plan Beneficiary of the subtrust, for life.
Following the settlor’s death, no independent trustee was appointed. As a result, no trustee held the trust’s power to modify the trust.
A settlement agreement subject to court ratification permitted the decedent’s daughter to exercise the powers granted to the independent trustee of the Marital Trust and to elect to treat the Marital Trust as an accumulation trust, to be administered as if the election to accumulate Roth IRA distributions had been timely made.
The taxpayer seeking the PLR represented that: the trust was valid under applicable state law; a copy of the trust had been provided to the Roth IRA custodian prior to Oct. 31 of the year following the death of the decedent; and the trust became irrevocable on the death of the decedent.
The PLR concluded that no regard may be given to the court settlement agreement, based on court precedent, and that the surviving spouse will be treated as the designated beneficiary of the Roth IRA over whose life expectancy RMDs may be made and that those distributions will be made based on the attained age of the surviving spouse in the year following the year in which the decedent died. In the beginning of the first year following the death of the deceased spouse, the value of the IRA must be divided by the life expectancy factor found in the RMD regulations Single Life Table. But, because the surviving spouse wasn’t the only individual who could receive the proceeds of Roth IRA distributions, the annual divisor is reduced by one each year. Thus, the life expectancy of the surviving spouse couldn’t be recalculated each year—the result that would have been attained if the effect of the court order had been recognized.
Roth IRA Recharacterization
In PLR 201932019 (May 15, 2019), the IRS granted a late recharacterization of Roth IRA contributions.
Over several years, two individuals who were married to each other made Roth IRA contributions. At some point, one of the individuals attended a seminar and learned that their Roth IRA contributions were impermissible because of limitations based on their modified adjusted gross income. They thereafter sought professional advice, culminating in a request for a PLR allowing a late recharacterization.
The IRS granted an extension of time to recharacterize their Roth IRA contributions as contributions to traditional IRAs. The IRS had authority to do so because the time for recharacterizing a Roth IRA contribution is set by regulation, not by statute.17
Transfer to Charity
In PLR 201943020 (Oct. 25, 2019), a charitable organization was named a sole beneficiary of a decedent’s IRA. But, the IRA custodian required two steps to occur for the charitable organization to receive the proceeds of that IRA. First, the decedent’s IRA’s property had to be transferred to an inherited IRA held for the benefit of the charity, bearing a title that included the charity’s name. The custodian referred to such an IRA as a “Transfer IRA.” After that transfer was completed, the custodian was then willing to allow all property held in the Transfer IRA to be distributed to the charity. The custodian used this two-step procedure to benefit the charity while avoiding payment of an income tax.
Endnotes
1. H.R. 1994 (May 23, 2019).
2. REG-132210-18, Federal Register (Nov. 8, 2019).
3. Revenue Ruling 2019-19 (Aug. 14, 2019).
4. 2019 ARD 184-2 (Sept. 23, 2019).
5. Revenue Procedure 2003-16 (Jan. 8, 2003).
6. Schermer v. Commissioner, T.C. Memo. 2019-28 (April 4, 2019).
7. Internal Revenue Code Section 691(c).
8. Burack, et ux v. Comm’r, T.C. Memo. 2019-83 (July 8, 2019).
9. Rev. Proc. 2003-16; see also supra note 4.
10. Lily Hilda Soltani-Amadi v. Comm’r, T.C. Summary Opinion 2019-19 (Aug. 2, 2019).
11. McEnroe v. Comm’r, T.C. Summary Opinion 2019-21 (Aug. 20, 2019).
12. Ibid., at p. 8.
13. Information Letter 2019-000 (March 4, 2019).
14. Rev. Proc. 2018-1, “Revised Procedures for Letter Rulings, Information Letters, Determination Letters” is updated annually.
15. Rev. Rul. 92-47 holds that a distribution to the beneficiary of a decedent’s individual retirement account that equals the amount of the balance in the account at the decedent’s death, less any nondeductible contributions, is income in respect of a decedent under IRC Section 691(a)(1) and so is includible in the beneficiary’s gross income for the tax year in which the distribution is received.
16. Note that a Roth IRA owner always dies before reaching the required beginning date, because there are no required minimum distributions during the account owner’s lifetime.
17. Treasury Regulations Section 301.9100-1, et seq.