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Level 1

Question

Inherated IRA

Forum|Forum|3 years ago
February 4, 2023
3 replies
3 views

My Mother Passed in March. I received a Inherited IRA . I had to open up my own account within the same Institution to have the Inheritance transferred then I cashed the money out. I was doing my PA taxes and I put the code 4 down as Directed. But there was no distribution reason that matched Inheritance IRA So I put the default reason. I am getting a return of exactly what the Inheritance amount was. what happens now. I do not know if I did something wrong...

Level 15

The distribution amount on the 1099-R for your inherited IRA account would be taxable on your Federal return.

Although Code 4 indicates 'death', when you removed the funds from the account, it is a taxable event. If the funds were moved to an account in your mother's name (with you as beneficiary), the distribution may not be taxable in Pennsylvania.

Here's more info on PA IRA Tax.

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Level 15

"what happens now. I do not know if I did something wrong"

You have to know what you are doing to file your own taxes.

maybe you should have a professional prepare your tax return. or seek other no-cost assistance.

Level 15

" I am getting a return of exactly what the Inheritance amount was."

are you saying you get a refund of the inheritance amount?

or your tax filing shows that amount as your total income.?

No matter what, since you cashed it out, you have to report the cash out as income on 1040 Line 4b.

That's all.