You are receiving this email because you signed up to receive Bob Carlson's free e-letter Retirement Watch Weekly, or you purchased a product or service from its publisher, Eagle Financial Publications. [Carlson's Retirement Watch Weekly] [Retirement Reports](www.retirementwatch.com/retirement-resources/) [Retirement Articles](www.retirementwatch.com/retirement-articles/) Brought to you by Eagle Financial Publications Don't Make These 4 IRA Mistakes by Bob Carlson
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[image]( There is a way retirees can collect thousands of dollars per month for the rest of their lives -- tax-free. Plus, this tax-free income source is 100% legal and approved by the IRS. And hereâs the kicker: even if they donât have enough money put away yet for retirement... even if theyâre over age 60... they can still get thousands of dollars a month from this opportunity. [Click here to find out more.]( [CLICK HERE...]( Inherited IRAs by Non-spouses Beneficiaries who inherit IRAs and other qualified plans often lose a lot of money learning the rules the hard way. There are different rules for a beneficiary who is the surviving spouse of the deceased owner and non-spouse beneficiaries. A non-spouse beneficiary shouldnât roll over the IRA to his or her own IRA or have the IRA changed to his or her name. Either of those actions is treated as a full distribution of the IRA. The balance will be included in gross income, and there isnât a way to reverse it. Instead, the inherited IRA needs to be segregated from other IRAs and re-titled with a name that includes the original ownerâs name, that he or she is deceased, and that the IRA is for the benefit of the beneficiary. No contributions can be made to an inherited IRA. It also canât be rolled over to another IRA or converted to a Roth IRA if it is a traditional IRA. Most non-spouse beneficiaries must distribute the entire IRA within 10 years after inheriting it. This applies to both traditional and Roth IRAs. Beneficiaries who arenât subject to the 10-year rule must begin annual required minimum distributions (RMDs) beginning by December of the year after the year in which the owner died. They need to learn their options, choose an RMD method and begin distributions on time. Surviving Spouse Beneficiary The 10-year distribution rule doesnât apply when a surviving spouse inherits an IRA. Instead, the surviving spouse has several options. One option is to treat the IRA as a non-spouse inherited IRA and elect to take annual RMDs using one of two methods. The methods depend on whether the deceased owner was taking RMDs before his or her death. The other option is to do a spousal rollover, also known as a âfresh startâ IRA. In a spousal rollover, the inherited IRA is rolled over into either a new IRA or an existing IRA in the surviving spouseâs name. In either case, the surviving spouse treats it as his or her own IRA without reference to the deceased owner. The surviving spouse names new beneficiaries and takes RMDs on his or her own schedule. If the surviving spouse isnât at least age 72 yet, RMDs arenât taken until after he or she reaches that age. Most surviving spouses should do the spousal rollover. An exception is when the surviving spouse is under age 59½. Then, the surviving spouse should choose one of the non-spouse options. The reason: When distributions are taken from a non-spousal inherited IRA, the 10% penalty for distributions taken before age 59½ doesnât apply, no matter how young the beneficiary is. But when the spousal rollover is used and the IRA is treated as the surviving spouseâs own IRA, the 10% penalty can apply to distributions taken before age 59½. After the surviving spouse turns age 59½, the spousal rollover can be executed. Thereâs no time limit to when the spousal rollover can be made. In next week's issue of Retirement Watch Weekly, Iâll share more common but costly mistakes to avoid. To a better retirement,
[Bob Carlson]
Bob Carlson
Editor, Retirement Watch Weekly Editorâs Note: According to the Survey of Consumer Finances (SCF), nearly half of all U.S. households have no money at all saved for retirement. Among those already retired, the savings rate is better... but still only $171,000 in 2022. Yet there is simple, but little-understood solution to this looming retirement crisis. If investors [act quickly enough](, they can LOCK IN a regular source of extra income with annual returns as high as 11.1%, guaranteed for life. Thereâs only one downside: this rare opportunity to lock in DOUBLE-DIGIT returns for life may not be available much longer. [Click here to find out more.]( SPONSORED [Stock Watchlist Now Available [Live]](
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[How to Vary Spending During Retirement]( New to the Retirement Watch Community: SeniorResource.com Iâve had several readers reach out to me lately regarding a Social Security matter. One, in particular, mentioned receiving an email back in April indicating a $600 increase in his Social Security check but has not yet received the increase or any details on when it will occur in June. The reader then asked for guidance on whom to contact at Social Security to address his question. [Click here for the answer.]( About Bob Carlson: [Bob Carlson]Robert C. Carlson is the author of the books The New Rules of Retirement and Retirement Tax Guide, editor and investment director of the popular retirement newsletter, Retirement Watch, and editor of the free weekly e-letter, Retirement Watch Weekly. Bob is a frequent speaker at investment conferences around the country, and you can also hear Bob as a featured guest on nationally-syndicated radio shows, such as The Retirement Hour, Dateline Washington, Family News in Focus, The Michael Reagan Show, Money Matters and The Stock Doctor. About Us:
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