4084 / How are the minimum distribution requirements met after the death of a tax sheltered annuity participant?
Editor’s Note: Post-SECURE Act, it was widely expected that the minimum distribution rules would no longer vary based upon whether the participant dies before or after his or her required beginning date. However, under regulations proposed in 2022, a beneficiary will be required to take annual RMDs during the new ten-year distribution period if the original account owner died on or after his or her required beginning date. See Q 3902 for details.
A tax sheltered annuity must satisfy the minimum distribution requirements set forth in IRC Section 401(a)(9) for qualified plans.1 Most of the requirements were explained in regulations published in 2002.2 Regulations governing annuity payouts from defined benefit plans were finalized in 2004 ( Q 4078, Q 3754), and regulations addressing additional matters were finalized under IRC Section 403(b) in 2007.3
The 2002 regulations simplified the calculation process and included longer life expectancy tables. The final regulations took effect for required minimum distributions in 2003 and later years ( Q 3896, Q 4078).