My mother died earlier this year at age 86. Before her death, she had not received any of her 2015 Required Minimum Distribution (RMD). Can her savings account still receive her RMD for this year?----->>I am so sorry to hear of your mother’s passing;
When your loved one has died and you're the beneficiary of the IRA, then you can take over control of the account simply by presenting the mother’s original death certificate to the bank or other company where the account is being held. But before you do, you'll need to understand the tax consequences of inheriting the account.
Her marginal tax rate is lower than mine.====> You need to pay income tax as the funds are received. UNLESS it is RMDs from Roth IRA . As you inherit a traditional IRA, you can cash out the account at any age , even before you reach age 59½ , without having to pay a 10% early-withdrawal penalty. But you need to pay taxes on the money in the account except for any nondeductible contributions.
I have read rules about 401k plans, rules about the year after death, and a general rule that says that anything not paid to the decedent must be paid to the surviving beneficiaries. =======>Correct; the amount of the IRA distribution , IMEAN Income in Respect of a Decedent, is included in the gross income of the beneficiary for the tax year when it is receivedafter the death of its owner, IRA/401K will be distributed in accordance with the most recent beneficiary designation on file with the retirement plan custodian. If there is no beneficiary designation on file, or if the named beneficiary does not survive the account owner, then the balance of the account will be paid to the IRA owner’s probate estate.
If I don't notify the investment company holding the IRA, the RMD will come out automatically, Mom will be issued a 1099, and I would report the income on her taxes.
===>I think so;As mentioned above; all money that is received from an inherited IRA that has not been previously taxed is taxable as ordinary income when received. as the beneficiary of the IRA that was inherited from your mother, you must include any taxable distributions you receive in your income as your mother deferred paying taxes on the amounts she contributed to the IRA plus any growth in the account over the years it was invested.
I know that starting next year, the RMD will be based on my age. ==>With the Inherited IRA or r-ira, you need to take annual distributions no matter what age you are when you open the account. Since your mother died in 2015, you need to start taking RMDs using your life expectancy by December 31, 2016. So, you don’t have the option of waiting until you are 60 to take withdrawals. Generally, non-spousal IRA beneficiaries must withdraw a minimum amount each year, starting by Dec. 31 of the year after the IRA owner diedThis doesn’t apply if you've simply transferred the IRA to your own IRA.but this option is not for you as you are not a deceased person’s serving spouse. You cannot rollover or transfer the Inherited IRA to your own IRA, because you are a non-spouse beneficiary.