SECURE 2.0 Trust-as-IRA-Beneficiary Decision
Determine the post-SECURE distribution treatment for a trust named as the beneficiary of an IRA. From Chapter 21 of the Trust Administration Guide.
The post-SECURE framework
Eligible Designated Beneficiary (EDB). Five categories qualify for lifetime stretch on the beneficiary's own life expectancy: surviving spouse; minor child of participant (stretch only until age 21, then 10-year rule); disabled individual; chronically ill individual; individual not more than 10 years younger than deceased participant.
Non-EDB designated beneficiary. All other designated beneficiaries. Subject to the 10-year rule — IRA must be fully distributed by December 31 of the 10th year following participant's death. Annual RMDs in years 1-9 required if participant died after RBD (per 2024 final regulations).
Non-designated beneficiary. Estate, charity, non-qualifying trust. Five-year rule (if participant died before RBD) or remaining ghost life expectancy (if after RBD).
Conduit vs accumulation: Conduit forces all distributions through to the named individual immediately (preserving EDB status but exposing the IRA to the beneficiary's personal circumstances). Accumulation preserves trust discretion but pays compressed trust-bracket tax on accumulated income.
Source: Trust Administration Guide Chapter 21, "SECURE 2.0: The Trust as IRA Beneficiary."