Inherited Roth IRAs

Question 1

What three methods does the IRS code allow for disposition of non-spousal inherited IRAs?

Answer 1

1. ) Open an inherited Roth IRA and take lifetime RMDs
2. ) Open an inherited Roth IRA and take payments over five years.
3. ) Take a lump sum distribution

Question 2

T or F

Because inherited Roth IRAs are tax free, no RMD are required for the account holder.

Answer 2

False.

Money must be distributed from the IRA using one of the five allowable methods, with lifetime RMDs being providing the longest payout period.

Note - The IRS apparently does not massive intergenerational, permanent build ups of tax free money.