Estate beneficiary of IRA distributed to beneficiary Inherited IRAs

Forum|Forum|4 years ago
March 1, 2022
1 reply
27 views

The estate was listed as the beneficiary of an IRA. Brokerage house created inherited IRAs for all of the estate beneficiaries and did direct transfers from the IRA in the estate's name to the inherited IRAs. A Form 1099R was issued to the estate. The estate beneficiaries did not receive a Form 1099R. How is this reported on Form 1041? Do I report the distribution on Line 8 and back it out? Or, do I issue K-1s to the beneficiaries showing the distributions and they show them as rollovers? I don't prepare the beneficiaries personal tax returns.

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B

Brother Jack

Level 4

I have numerous questions on this but will start with

1. Who instructed the Brokerage house to create and distribute the account to the (ultimate) beneficiaries.Somebody had to provide them with the information

2. Did the beneficiaries liquidate their accounts before the end of the year? or do some remain beneficiary accounts

J

janice-mcclellanAuthor

Level 3

The broker told the executrix, if the IRA proceeds from the estate IRA are directly transferred to inherited IRAs in the names of the estate beneficiaries, the proceeds would not be taxable to the estate. The beneficiaries would have to withdraw the proceeds within 10 years. The transfer into the beneficiary IRAs was done before 12/31. As far as I know the beneficiaries have not withdrawn anything from those IRAs. However, I'm not their accountant.

So, the executrix provided the brokerage firm with all of the beneficiary info.

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Brother Jack

Level 4

Do you know if the 1099R is for the complete account liquidation or perhaps just an RMD amount the decedent was required to take.

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