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Inherited IRA trust

My father-in-law passed away in 2019 and he left part of his IRA to a his wife and part to my wife in a conduit trust. The purpose of the trust was to be able to stretch contributions over my wife's life. I am struggling to understand which tax forms and how to file for this trust. All income inside the IRA is not taxable only the distributions and then they should be taxable to my wife. The 1099R lists the Trust's EIN as the Recipient. The K1 generated for my wife has $0 distribution even though there was a distribution. Is the distribution from the IRA the Trust income which was then distributed? Do I need to file  a form 5305?

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Level 15

Inherited IRA trust


@maw246 wrote:

Am trying to file 1041 (if appropriate) which should generate K1 for distribution to my wife. Have only received the 1099R from IRA. 


Click the Federal Taxes tab, click Income, and then click the Start button to the right of Other income or loss (see the first two screenshots). Enter the amount from Box 2a as other income.

 

Note that you will have to make a distribution in the Distributions section (under the Federal Taxes tab) of the program.

 

TTBiz1099R1.pngTTBiz1099R2.png

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Level 15

Inherited IRA trust

Your post was slightly confusing in the sense that you mentioned details concerning the 1099-R, but then also that there was a K-1 (presumably received?) that did not reflect any income that might be taxable to your wife.

 

Further, your profile indicates might be using TurboTax Business. Is that the case and, if so, are you attempting to prepare the 1041 and K-1? 

New Member

Inherited IRA trust

Am trying to file 1041 (if appropriate) which should generate K1 for distribution to my wife. Have only received the 1099R from IRA. 

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Expert Alumni

Inherited IRA trust

As tagteam asked, can you clarify what role you play in this scenario?

 

Are you the Trustee?  

 

You will need an EIN for the Trust if you don't already have one (one wasn't needed up until now) if you answer YES to any of the questions in this IRS link.  (ie, the trust you are referring to is no longer a grantor (revocable) trust)  The link will take you to that application when you choose YES to that question.  Do I need an EIN?

 

Conduit trusts are trusts distribute IRA distributions (and RMDs) to the trust beneficiaries.  

 

A Form 1041 will need to be filed, and the 1099R will be entered as a distribution within the trust.  The Trust will then distribute the IRA proceeds to the Beneficiaries.

 

 

 

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Highlighted
Level 15

Inherited IRA trust


@maw246 wrote:

Am trying to file 1041 (if appropriate) which should generate K1 for distribution to my wife. Have only received the 1099R from IRA. 


Click the Federal Taxes tab, click Income, and then click the Start button to the right of Other income or loss (see the first two screenshots). Enter the amount from Box 2a as other income.

 

Note that you will have to make a distribution in the Distributions section (under the Federal Taxes tab) of the program.

 

TTBiz1099R1.pngTTBiz1099R2.png

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