Abney at Law, P.C.
Call Today for a Free Consultation
301-850-4972

Inherited IRAs can be split during a divorce

The federal tax code and various laws regulate how certain assets are divided during a divorce. However, there are no clear rules regarding inherited IRAs. Despite the absence of any legal guidelines, inherited IRAs are being divided up in family courts in Maryland and across America. With new alimony rules coming into place at the beginning of 2019, these retirement accounts may play an even bigger role during divorce in the future.

When an inherited IRA gets divided, it retains its inherited status and the minimum distribution schedule stays the same. The only significant change is the adding of the new beneficiary. Each spouse in this case will be responsible for future RMDs based on the percentage they keep. This commonly happens when the owner of the IRA decides to use their inherited account to satisfy the agreed property split.

Whether or not an inherited IRA is eligible for division during a divorce usually depends on its designation as a marital or separate asset. Since these types of IRAs cannot be owned jointly or receive additional contributions, many experts believe they are clearly separate assets. Until official rulings or laws are in place, however, family courts may decide differently.

Ex-spouses who are trying to decide whether splitting an inherited IRA is in their best interests could benefit from legal guidance. A lawyer will have knowledge about state laws and recent decisions made in local family courts, and they can use this knowledge to advocate on the behalf of their client during divorce negotiations and arguments. A lawyer could also provide advice regarding tax issues related to dividing retirement IRAs.

No Comments

Leave a comment
Comment Information

Office Location

Abney at Law, P.C.
20 Courthouse Square, Suite 205
Rockville, MD 20850

Phone: 301-850-4972
Fax: 866-330-8861
Rockville Law Office Map

Email Us For A Response

Arrange A Free, Personal Meeting With Me

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy