I inherited my mom's IRA accounts (two of them) when she passed away in 2017. I did not directly receive the money. I had both accounts transferred trustee-to-trustee into a single new inherited IRA account I opened at Vanguard. Account ownership calls out that it is inherited, shows my mom's name as deceased with me as beneficiary, etc. One of the companies sent me a 1099R and it shows that I took a taxable total distribution. Box 1 and 2a are the same amount (the amount i inherited). Box 2b IS checked, along with "total distribution". Box 7 is a 4 (death) with the IRA box checked. I don't have to take an RMD till 2018 and the 2017 distribution for my mom was covered by my brother who took his 50% all in cash.
How do I report this as a non-taxable transfer? It's for sure when I take my RMD's that they'll be reported as distributions from the new inherited IRA. I feel like this company put me on the hook to pay double the tax. Can they be made to correct this 1099r? OR is this normal reporting and I am entering it wrong? Help! Thanks!
