Inherited traditional IRA

[boyerej]

My wife inherited half of a traditional IRA. The 1099-R shows the entire distribution. Form W-4R/OMB from the Bank shows she only received half.  How do we document that for taxes?

[dmertz · Accepted solution]

It seems extremely unlikely that the custodian would make the error of reporting all on one beneficiary's Form 1099-R a distribution paid to multiple beneficiaries, but if that truly occurred, your wife needs to contact the payer to obtain a corrected Form 1099-R.  That the Form 1099-R includes the entire amount suggests that your wife inherited the entire IRA because she was the only designated beneficiary.  If your wife then gave a portion of that to someone else, that's a gift from your wife to the other person, possibly reportable on Form 709, but your wife is still responsible for paying the tax on the entire distribution.