topic Inherited IRA paperwork in Retirement tax questions

Inherited IRA paperwork

sansa12 — Wed, 19 Feb 2025 16:19:44 GMT

My mom passed away last July and I inherited a traditional ira. Prior to receiving the check I have them take 20% out in Federal tax. I did my taxes and it took an additional $1,250 which I think is due to it throwing me into another tax bracket. My question is before e-filing my taxes do I need to fill out any other paperwork other than what it asks me when I did turbotax. I did check the box it said inherited IRA and it did a self-check and said everything was okay. I'm just seeing if I need any other paperwork. Also I'm doing my mom's taxes now that she is gone there is no more state it has been dissolved and I need to know if there's any other paperwork that I need to file with her taxes in order to receive her refund. I am the power of attorney and I am the closest living family member?

Re: Inherited IRA paperwork

BrittanyS — Mon, 24 Feb 2025 22:29:30 GMT

When you answer the interview questions in TurboTax, the necessary forms will be added to you return when you file. You should keep all supporting documents with your return for your records but unless notified during the filing process by TurboTax, you will not need to mail anything in. TurboTax will handle everything for you and for your mother's final return. If using TurboTax Desktop, you can view the forms for accuracy by clicking forms in the top right corner prior to submission. For TurboTax Online, you can view a preview of the return by selecting tax tools in the left side panel>click tools> preview tax summary> preview my 1040.

If you are filing your mothers final return, you will file a federal and state return for the year of her passing. See the link below for additional information on the forms that are needed:

What forms will I need for someone who's deceased?

Re: Inherited IRA paperwork

Opus 17 — Mon, 24 Feb 2025 22:50:48 GMT

You have two different questions.

1. If you inherited her IRA, you had the option of cashing it out all at once or over 10 years. If you cashed it out all at once, it is added to your tax return and you pay whatever tax is owed. You get credit for any withholding, but you might owe more, depending on all the facts and circumstances. You don't need to do anything else with your tax return. If you inherited the IRA then this is your income and it goes on your tax return.

2. But then you asked about your mother's tax return. If she died in July 2024, then someone needs to file a 2024 return in her name that reports her income, deductions and credits up to the date she died. (Any income paid after she died is handled differently.). The person who files her final tax return is called her personal representative. This is usually her next of kin, or the executor of her estate. You may need to go to court or file a form with the probate court, it depends on state law. If you are expecting a refund, you need to include form 1310 so it can be paid in your name rather than your mother's name.

There is more information here.

https://www.irs.gov/individuals/file-the-final-income-tax-returns-of-a-deceased-person

https://www.irs.gov/forms-pubs/about-publication-559

https://www.irs.gov/newsroom/how-to-file-a-final-tax-return-for-someone-who-has-passed-away

3. The estate is a separate legal entity that comes into existence after she died. It covers income received after she died (like a final pension payment). For small estates, that income can be handled by you as "income in respect of a decedent" rather than filing a separate estate tax return, which requires a different version of turbotax and extra paperwork.