In PLR 201245004 a surviving spouse received IRA distributions in excess of the required minimum distribution for the year of the deceased spouse’s death but was allowed to disclaim the balance of the IRA. The ruling states:
In Rev. Rul. 2005-36, 2005-1 C.B. 1368, a beneficiary received RMDs from an IRA. The Service ruled that receipt of the RMD constitutes acceptance of that portion of the corpus of such account, plus the income attributable to that amount. However, the Service also ruled that if the beneficiary disclaims the remaining balance of the IRA, assuming the other requirements of § 2518 are satisfied, the beneficiary’s acceptance of the RMD amounts does not preclude the beneficiary from making a qualified disclaimer with respect to the balance of the IRA.
In this case, the automatic deposits into the bank account held by Trust to benefit Spouse continued for two months after the Decedent’s death and then were cancelled. During the two months the withdrawals equaled $C. The facts in this case are similar to the facts in Rev. Rul. 2005-36. Similar to the revenue ruling, Spouse has accepted the benefit of $C and the income attributable to $C. However, assuming the other requirements of § 2518 are satisfied, Spouse’s acceptance of the RMDs amounts does not preclude Spouse from making a qualified disclaimer with respect to the balance of the IRA.
In this case, as a result of Spouse’s disclaimer, the balance of the IRA passed to Family Trust. The terms of Family Trust were established by Decedent when he created Trust. Accordingly, the disclaimed property did not pass pursuant to the direction of Spouse. With respect to IRA benefits payable to Family Trust, during Spouse’s lifetime, Trustee is required to withdraw each year from the IRA the greater of the RMD for that year and that portion of the IRS benefits that constitutes the accounting income of the IRA benefits. Additionally, Trustee shall withdraw so much of the net income and principal of the IRA benefits payable to the Family Trust as Trustee determines is necessary for Spouse’s health, education, maintenance, and support. Family Trust terminates upon the death of Spouse and the balance of the trust will be administered under Article Sixth of Trust. Accordingly, pursuant to the terms of Trust and Family Trust, Spouse does not have any right to direct the beneficial enjoyment of the disclaimed property.