Inheriting an IRA? Know Your Options to Minimize Taxation
You may already know that Albert Einstein once stated "compound interest is the most powerful force in the universe." What you may not know is how to leverage compound interest through future generations.
Many of my clients have been faced with an important decision: How to minimize income taxes while inheriting an IRA.
According to IRS Publication 590, the beneficiary of an IRA has three choices:
- Lump Sum
- Deplete balance within 60 months
- Required Minimum Distributions
Watch this video as I explain the power of compound interest.
Randy1949
11:38 am on Friday, August 24, 2012
True. IRAs are not like a regular inheritance. You will pay taxes when you take distributions. This is especially frustrating when the IRA is invested in funds that you normally would not want to have, at a financial company one would not normally wish to patronize. There seems to be no option for a rollover.