Man, the Social Security laws are written to screw you if

[progree]

12. A person can be retired with no IRA and get a BDA-IRA set up.

Last edited Wed Dec 11, 2019, 09:35 AM - Edit history (2)

In fact, you wouldn't have wanted to put the money in a regular IRA if you had had one, that would have been an illegal move. Inherited IRAs must be placed in a BDA-IRA account which is unlike regular conventional IRAs.

It is never a good idea to cash out an IRA and then roll it over into another IRA. There's a 60 day rollover window and other ways one can mess up. It should always be done via direct transfer from IRA account to IRA account, or in this case, from IRA account to BDA-IRA account. The new IRA account that is being transferred to can be a new empty one (zero balance) until the transfer occurs. As they were in my and my sister's cases.

The tax deferral benefit of an IRA is awesome. Although unfortunately now that it has been done (the IRA has been distributed from a tax standpoint, i.e. transferred to a regular taxable account), there's no way the IRA will let that be reversed and redone. At least from everything I've read, there are no do-overs. But oh well, it's done and you've paid the taxes and don't have to fiddle with the RMDs and bookkeeping every year.

I was very fortunate in that Fidelity (where my parents' IRA account was) sent us an excellent booklet on how to handle inherited IRA assets. We (my sister and I) were also fortunate in having good tax advisers. I had also recently read one of Ed Slott's IRA books. And then there was (and is) irahelp.com