Life and Death Planning for Retirement Benefits

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72 Life and Death Planning for Retirement Benefits
beneficiaries. If “D” above applied during the spouse’s life, and the spouse later dies
before all the benefits have been distributed to her, here is how to compute RMDs for her
successor beneficiary(ies): If the participant had died before his RBD, and the surviving
spouse then died before her Required Commencement Date, see C). Otherwise,
the RMD for the year of her death must be paid out to the successor beneficiary to the
extent the spouse had not already taken it by the time of her death, and any remaining
benefits must be paid out (beginning the year after the year of the spouse’s death) over the
spouse’s remaining life expectancy, using the fixed-term method B)). This is
computed based on the age she attained (or would have attained if she had lived long
enough) on her birthday in the year of her death and reduced by one year for each year
thereafter. Reg. A-5(c)(2). It is not clear whether this rule (successor
beneficiaries take over what’s left of the surviving spouse’s life expectancy) applies even
if the ADP that applied to the spouse herself was the participant’s remaining life
expectancy rather than her own (see B)).
1.6.04 Required Commencement Date: Distributions to spouse
If the participant dies on or after his RBD , the Required Commencement Date
for RMDs to the surviving spouse-beneficiary is the same as the Required Commencement Date
for distributions to any other beneficiary: December 31 of the year after the year of the participant’s
death (or, if the participant died in 2008, December 31, 2010; . Reg. A-
5. As is true for other beneficiaries, the spouse as beneficiary must also withdraw, by the end of
the year of the participant’s death, any part of the year-of-death RMD not distributed during the
participant’s life. A).
If the participant dies prior to his RBD, and the spouse is the sole Designated Beneficiary
, annual distributions to the spouse over her life expectancy do not have to begin until
the later of the following years, “X” or “Y”:
X: The year following the year in which the participant died (unless the decedent died in 2008,
in which case the “X” year is 2010); or
Y: The year in which the participant would have reached age 70½ (unless the decedent would
have reached age 70½ in 2009, in which case the “Y” year is 2010).
Reg. A-3(b); Part V, A-2. Thus, the
surviving spouse’s “Required Commencement Date” is December 31 of whichever of the above
two years (X or Y) is applicable. However, the spouse may have to make an irrevocable election
earlier than that deadline to preserve her rights; se C).
1.6.05 Special “(B)(iv)(II) rule” if both spouses die young
If the participant died before his RBD, and his spouse survives him, and the surviving
spouse is the sole Designated Beneficiary , the spouse does not have to commence taking
RMDs until the end of the year in which the participant would have reach age 70½, as explained
at then provides a special rule that applies upon the surviving
spouse’s later death if she dies before this “Required Commencement Date.”
Under the special (B)(iv)(II) rule , RMDs for years after the year of the spouse’s death will
not be based on the spouse’s remaining life expectancy, as would normally be true for RMDs