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jal102030
New Member

Death exception to tax on early distributions

In 2016, I inherited a simple IRA upon the death of my father.   I received cash for this IRA.  Does my father' death qualify as the death exception to avoid paying taxes on the early distribution?  I don't understand who is described as the "death"
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2 Replies
Phillip1
New Member

Death exception to tax on early distributions

If the distribution was due to the death of your father (there should have been a 4 in box 7 of Form 1099-R) there should not be a penalty on line 59 of Form 1040. If there is a penalty, this qualifies as an exception to the early withdrawal penalty.

Check your return to verify whether there is a penalty being calculated:

  1. Click on the My Account link at the top of the window.
  2. Click on the Tools link in the dropdown menu.
  3. Click on the View My Tax Summary option in the Tools Center box.
  4. Click on Preview my 1040 at the top of the Tax Summary Screen.
  5. In the Preview My 1040 screen, scroll down to line 59 of Form 1040.

Death exception to tax on early distributions

If there is a penalty, you made a mistake somewhere.
there is no penalty applied to a cashed out  inherited IRA which is what you have..
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