Let's back up. What did you do with the $976? Is the 1099R in your name or his name? Turbo Tax is not asking what you want to do but what you actually did with it. My husband died in 2023 and Vanguard moved his IRA into my IRA and did not give me a 1099R for it. You got the 1099R because you took a distribution.
If his IRA is still funded, that decision has to be communicated to your custodian who can explain your options.
It has nothing to do with a Code 7 1099-R.
Since you inherited the IRA from your spouse, you're permitted to roll it over into your own existing IRA. If you don't need the $ now, rolling it over into your own IRA will allow the money to continue to grow tax-deferred.
Let's back up. What did you do with the $976? Is the 1099R in your name or his name? Turbo Tax is not asking what you want to do but what you actually did with it. My husband died in 2023 and Vanguard moved his IRA into my IRA and did not give me a 1099R for it. You got the 1099R because you took a distribution.