Take-Away: A surviving spouse may wish to be treated as the beneficiary of their deceased spouse’s IRA for a couple of technical reasons. The reality is, however, that a spousal rollover of the decedent’s IRA is the most tax efficient way to deal with the IRA due to the Table used to calculate required minimum distributions (RMDs) and the possible delays in having to take an RMD.

Background: Michigan’s revocation of a devise or bequest upon divorce statute provides that the divorce or annulment of marriage revokes: (i) a disposition or appointment of property made by a divorced individual to his or her former spouse in a governing instrument and a disposition or appointment created by law or in a governing instrument […]