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dsudlik
New Member

Do I have to pay tax on wife's IRA that passed to me on her death and which I then transferred to her children per her will?

When my wife died Fidelity transferred her IRA into my name and pursuant to her will I transferred the funds equally to her children as stated in her will. Fidelity lists the amount on the 1099-R as a taxable distribution to me and it is listed as taxable to me even though I never saw any money. Do I pay taxes on the distribution even though I was following her will?

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Accepted Solutions
dmertz
Level 15

Do I have to pay tax on wife's IRA that passed to me on her death and which I then transferred to her children per her will?

If you were the designated beneficiary of your wife's IRA, yes, this is taxable income to you and must be reported on your tax return.  The will has no bearing on this because this is not part of the probate estate.

Whatever you gave to her children are gifts from you to her children and have nothing to due with your wife's estate.  You must file a 2018 Form 709 Gift Tax return if your gifts to any one person in 2018 exceeded $15,000.

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2 Replies
dmertz
Level 15

Do I have to pay tax on wife's IRA that passed to me on her death and which I then transferred to her children per her will?

If you were the designated beneficiary of your wife's IRA, yes, this is taxable income to you and must be reported on your tax return.  The will has no bearing on this because this is not part of the probate estate.

Whatever you gave to her children are gifts from you to her children and have nothing to due with your wife's estate.  You must file a 2018 Form 709 Gift Tax return if your gifts to any one person in 2018 exceeded $15,000.

fanfare
Level 15

Do I have to pay tax on wife's IRA that passed to me on her death and which I then transferred to her children per her will?

if a large amount is involved you may have to claw back some of that money from your kids to pay the income tax.
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