Distribution from Roth IRA after death showing as Traditional IRA on 1099-R Summary

[DaveOxFX]

My father had a Roth IRA and listed me as the beneficiary.  When he died I took a lump sum distribution of the total amount.  The 1099-R shows the full amount in box 2a Taxable Amount, and has a check in the "Taxable Amount Not Determined".  There is only a "4" in box 7 (Death).  When I plug this into TT the amount of the distribution shows up on the 1099-R Summary under Traditional IRA Distributions instead of under the Roth IRA Distributions section and makes it taxable.  Is it possible the 1099-R is incorrect and should show zero in box 2a?  It seems like the Gross Distribution should show up in the Roth IRA section of the summary with the full amount listed on line 14 & 15 as a Qualified Distribution since it is due to death.  Distributions from a Roth IRA to a beneficiary after death are supposed to be tax-free.  What am I doing wrong?

[MargaretL]

You are not doing anything wrong, it is the code on the form that triggers incorrect entries. The inherited IRAs are usually reported with code T or Q, in addition to code 4. Those codes indicate if the inherited distribution is qualified or not. If your father's Roth IRA meets the 5-year holding requirement (it means your dad made his first contribution to any Roth before 2014), then all distributions you receive from this account are tax-free, as they are considered a qualified distribution. 

If the first contribution was after 2014, then your distributions follow the ordering rules for NON-qualified distribution with taxable earnings being taken out at last. 

I recommend that you contact the administrator of the IRA and ask for a corrected 1099-R.  You may have to file for an extension... and be sure to pay any tax due by April 15th... the extension is for filing, not for paying.

[DaveOxFX]

Thank you for verifying the rules.  I have contacted them and hopefully I'll get this resolved.

Many thanks!

[macuser_22]

An inherited Roth IRA can never have another box 7 code other than a "T".    Neither Q no 4 is allowed.

If code 4 (if the IRA/SEP/SIMPLE box is also checked) indicated that this is an inherited Traditional IRA and not a Roth IRA.