topic WHAT MEANS WHEN SAYS: " DID YOU INHERIT THE IRA FROM RETIREMENT SERVICES? in Retirement tax questions

WHAT MEANS WHEN SAYS: " DID YOU INHERIT THE IRA FROM RETIREMENT SERVICES?

ivanniesrosarion — Sun, 09 Feb 2020 01:53:30 GMT

Re: WHAT MEANS WHEN SAYS: " DID YOU INHERIT THE IRA FROM RETIREMENT SERVICES?

macuser_22 — Sun, 09 Feb 2020 02:01:49 GMT

It want to know if the IRA was your own IRA if you inherited it from someone that died and left it to you.

Re: WHAT MEANS WHEN SAYS: " DID YOU INHERIT THE IRA FROM RETIREMENT SERVICES?

emosteve5 — Tue, 11 Feb 2020 23:01:23 GMT

Sorry but the response was unclear. I have the same issue. It looks like TT is asking if the IRA was inherited from the financial institution holding the IRA, as opposed to inheriting it from a person. Which is it?

Re: WHAT MEANS WHEN SAYS: " DID YOU INHERIT THE IRA FROM RETIREMENT SERVICES?

ColeenD3 — Tue, 11 Feb 2020 23:10:25 GMT

Retirement Services is the name used, the holder of the IRA, because it is unknown who you actually inherited from. In addition, the program is being clear because you could have inherited more than one IRA from more than one institution.

Re: WHAT MEANS WHEN SAYS: " DID YOU INHERIT THE IRA FROM RETIREMENT SERVICES?

dmertz — Tue, 11 Feb 2020 23:26:07 GMT

Many people complain about the improper wording of this question in TurboTax but TurboTax Product Quality has indicated that they see no need to change it. The question is actually asking, "Did you inherit the IRA that is held at Retirement Services?"

Re: WHAT MEANS WHEN SAYS: " DID YOU INHERIT THE IRA FROM RETIREMENT SERVICES?

rprastein — Fri, 12 Nov 2021 03:04:51 GMT

OK, in one sense I understand that, but here's the thing. I'm doing taxes for my Dad. I'm catching up on a lot of back taxes, actually, in reverse chronological order, following two years of trying to finish up identifying what all he has and cleaning up the mess that resulted after Mom died.

Mom had an IRA with American Century. In 2012, she died, and Dad inherited that account with American Century. In 2016, the account was properly transferred at American Century to be in Dad's name, not as Mom's beneficiary, in anticipation of moving it to Fidelity where I could manage all of his assets in one place. For various reasons I never got the account moved to Fidelity until 2019, when Dad moved in with me.

When I tried to move it as an Inherited IRA account, the transfer failed -- the account type didn't match; it had to be moved as a Traditional IRA.

But I don't know if that is a Fidelity quirk, or if the IRS makes the same distinction. Do I answer "NO" in TurboTax for the 1099-R on this Fidelity account? What is the practical implication of one answer vs the other?

Thanks,

Rebeccah

Re: WHAT MEANS WHEN SAYS: " DID YOU INHERIT THE IRA FROM RETIREMENT SERVICES?

Critter-3 — Fri, 12 Nov 2021 12:41:21 GMT

Ok ... if the IRA was merged into his IRA or retitled in his name then the IRA is no longer inherited.

Only non spouse inherited IRAs are always titled as such and are always considered inherited IRAs.

Re: WHAT MEANS WHEN SAYS: " DID YOU INHERIT THE IRA FROM RETIREMENT SERVICES?

rprastein — Fri, 12 Nov 2021 16:25:29 GMT

Thanks.