Distribution Period
The distribution period (the divisor) is the maximum number of years over which a beneficiary is allowed to take life expectancy payments from an inherited IRA. The distribution period for beneficiary life expectancy payments are obtained from the Single Life Expectancy table.
Note: The distribution period used to calculate required distributions for the IRA Owner's year of death are obtained from the Uniform Lifetime table unless a spouse who is more than 10 years younger than the IRA owner is the sole beneficiary of the IRA when the Joint and Last Survivor table is used.
IRA Type
Traditional IRA: Contributions to a Traditional IRA, in some cases, may be fully or partially deductible. In addition, growth that occurs within a Traditional IRA (including income and gains) accumulates on a tax deferred basis and is not taxed until distributed.
Roth IRA: While there is no tax deduction for Roth IRA contributions, the return of contributions from Roth IRAs is never taxed at the time of distribution. In addition, growth that occurs within the Roth IRA (including income and gains) may also qualify for tax-free distribution if certain requirements are met at the time of distribution.
SEP IRA: A SEP IRA is a Traditional IRA which receives tax-deferred contributions (generally employer contributions) under an employer SEP (simplified employee pension) plan. Amounts within a SEP IRA grow tax deferred and are not taxed until distributed.
SIMPLE IRA: A SIMPLE IRA is an IRA that receives tax-deferred contributions (i.e., salary deferrals and employer contributions) under an employer SIMPLE (savings incentive match plan for employees) plan. A SIMPLE IRA can only receive SIMPLE IRA contributions. Amounts held within a SIMPLE IRA grow tax deferred and are not taxed until distributed.
Beneficiary Type
Spouse: Spouse is an individual who is treated as the IRA owner's spouse under applicable state law on the date of the IRA owner's death.
Eligible Nonspouse: Eligible Nonspouse Beneficiary for purposes of this tool is any nonspouse beneficiary who, on the date of the IRA owner's death qualified as an Eligible Designated Beneficiary (i.e., disabled, chronically ill, not more than 10 years younger than the deceased IRA owner, or a child of the deceased IRA owner who had not yet attained 21 years of age). Eligible Nonspouse Beneficiary also includes any individual who is the beneficiary of a Traditional, SEP or SIMPLE IRA whose IRA owner died on or after the required beginning date.
Eligible Trust (Spouse): Eligible Trust (Spouse) for purposes of this tool is a trust beneficiary that is
- valid under state law,
- irrevocable at the IRA owner's death,
- has the spouse of the IRA owner as the only identifiable beneficiary, and
- the trustee of the trust has provided the IRA administrator with a copy of the trust instrument or qualifying trust documentation by October 31 of the calendar year following the year of the IRA owner's death.
Eligible Trust (Nonspouse): Eligible Trust (Nonspouse) for purposes of this tool is a trust beneficiary that is
- valid under state law,
- irrevocable at the IRA owner's death,
- has an identifiable beneficiary(ies) who qualifies as an Eligible Nonspouse Beneficiary (see Eligible Nonspouse Beneficiary), and
- the trustee of the trust has provided the IRA administrator with a copy of the trust instrument or qualifying trust documentation by October 31 of the calendar year following the year of the IRA owner's death.
Ineligible Trust: Ineligible Trust for purposes of this tool is any trust that that is not a qualified see-through trust
Estate: Estate is the deceased IRA owner's estate
Charity or Other Entity: Charity or Other Entity includes an entity including, but not limited to organizations such as a church, college/university, or other nonperson entity.
IRA Balance
The IRA balance is generally the beneficiary's share of the fair market value in the IRA on December 31 of last year. However, any transactions (i.e., transfers and direct rollovers from employer plans) that were outstanding (i.e. not in an IRA or employer plan) at year-end must be added to the year-end balance when calculating the life expectancy payments.
You selected "Qualified Trust - Multiple Person Beneficiaries" as the beneficiary type. In the "Beneficiaries Date of Birth" field, enter the date of birth of the oldest trust beneficiary.