inheritance

recieved an ira tranfered to myself directly inherited does expire next year was told no tax due this year?

Level 6

Hi jslimmers,

Thanks for participating in today's event!

It sounds like you received an inherited IRA. There are various factors that determine the tax impact of this.

One factor is whether this is a Roth IRA or a traditional IRA. If it is a Roth IRA, and the account is at least five years old, then the entire distribution is tax-free. If the account is less than five years old, any withdrawals of contributions are tax-free, but withdrawals of earnings are subject to income taxes. If this is a traditional IRA, then the entire withdrawal is subject to income tax for the year you take the distribution.
Death of the account holder is another factor (whether they died before 2020 vs. in 2020 or thereafter).
Your relationship to them is yet another factor (spousal vs. non-spouse).

This IRS site provides more guidance on this issue: Retirement Topics - Beneficiary

I hope this information is helpful.

Kindly,

Katie

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