Maybe I'm just having a brain fart from staring at PRC for days on end, and the end of a long day today. I have a client that has a traditional IRA, say $1m. When he dies, that will be divided between his three kids from his prior marriage, and his current spouse. I'm not seeing a way to have the chunk going to his kids from disappearing from the plan without taxes coming out or anything. The part left for his wife is fine, of course.
I looked at a scheduled withdrawal (assuming date of death, as we do in PRC) and then a Miscellaneous expense to get it off the books. But it's taxed, of course, leaving the spouse with a not-real huge tax bill. It's almost like PRC needs an entry in the drop down "for no tax and no penalty". There's already an entry for withdrawal from a trad IRA with no penalty.
Can anyone else figure a way to do that? Something with charities maybe (but then that might look like a tax writeoff...). I don't want to call it a Roth because it's not and that would also screw the taxes up. I'm still brainstorming here.
Per Stuart, checking to see if purchasing an annuity from the IRA and not paying it out ever would clear it. Might still screw up total worth but maybe everything else is good.
If after age 70.5 age, looks like Pralana doesn't put any limits on the size of a QCD. It does prevent you from doing QCDs early.
@ricke That seems to work better! Thank you so much. Something was nagging at my tired brain about "charity" and that was it. Fresh start this morning helped, along with your tip. Of course, the QCD still screws things up in terms of taxes and so forth, but it's close enough for now. I'll lobby for new entries in the scheduled withdrawals table "No Taxes No Penalties" for a future release.
Related question: when my spouse dies, 2/3 of each of her accounts will go to her kids. So I can use the QCD for her IRA, but how do I specify 2/3 of her Roth and 2/3 of her regular investment account getting depleted?
