Grandpa has a traditional IRA and is over 70 1/2.

He had received required minimum distributions for several years. Grandpa dies in 2009. His two daughters were named as beneficiaries. The daughters would like to cash in their IRA's as follows: 50% in 2009, and 50% in 2010. These amounts obviously exceed the RMD, however, is there any penalty associated with taking the distributions out early? I know the distributions would be taxable, but are there related penalties?

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There are no beneficiary penalties associated with taking the distributions early.

taxbilly

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