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Level 2

Solved

In the year that a beneficiary IRA is created (when I roll over my deceased relative's 401(k) into a new ira), am I ineligible for the savers credit?

Forum|Forum|7 years ago
June 1, 2019
1 reply
12 views

Will this roll-over be considered a retirement distribution making me ineligible for the Retirement Savings Contribution Credit?

Best answer by dmertz

No.

An IRA inherited by an non-spouse beneficiary can only be moved to an IRA for the benefit of the beneficiary by nonreportable trustee-to-trustee transfer, not by reportable distribution and rollover. A non-spouse beneficiary is not permitted to roll over any distribution paid to the beneficiary.

Even if a non-spouse beneficiary receives a distribution from an inherited IRA, the distribution does not affect that individual's eligibility for a Retirement Savings Contributions Credit. This distribution is not to be included when TurboTax asks if there were any distributions in the period from 2 years before the tax year through the due date of the tax return.

dmertzAnswer

Level 15

No.

An IRA inherited by an non-spouse beneficiary can only be moved to an IRA for the benefit of the beneficiary by nonreportable trustee-to-trustee transfer, not by reportable distribution and rollover. A non-spouse beneficiary is not permitted to roll over any distribution paid to the beneficiary.

Even if a non-spouse beneficiary receives a distribution from an inherited IRA, the distribution does not affect that individual's eligibility for a Retirement Savings Contributions Credit. This distribution is not to be included when TurboTax asks if there were any distributions in the period from 2 years before the tax year through the due date of the tax return.