The Form 1099R is reported in error under your daughters SSN, however you can use the procedures below to distribute it to each of the heirs, including yourself. Follow the instructions below for nominee returns and then each heir will report their share of the distribution on each of their returns. Use the Code 4 just like the one you received for each form you complete for the heirs (including yourself).
Nominee returns. Generally, if you receive a Form 1099 for amounts that actually belong to another person or entity, you are considered a nominee recipient. You must file a Form 1099 with the IRS (the same type of Form 1099 you received). You must also furnish a Form 1099 to each of the other owners. File the new Form 1099 with Form 1096 (this is a transmittal for the 1099) by mailing to the Internal Revenue Service Center for your area.
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On each new Form 1099, list your deceased daughter as the payer (name, deceased) and the other owner, as the recipient. On Form 1096, list yourself as the nominee filer, not the original payer. The nominee is responsible for filing the subsequent Forms 1099 to show the amount allocable to each owner.
The forms filed with the IRS should be the red copy so if you don't have a color printer, go to the IRS website and order the forms here: Click here to order forms or publications from the IRS or click below to print the forms.
