Form 8606 Issues

[PC129]

If a surviving spouse takes ownership of the decedent spouse’s only IRA, before the end of the year of death, line 6 of the decedent’s IRS form 8606 will always be zero, line 10 will always be 1.00000 and line 12 will always equal the entire distribution for the year, which will be declared nontaxable.

It will also substantially reduce the basis going forward.

Is that the intent?

[fanfare · Accepted solution]

@PC129 

IRS says:

"If you become the owner in the year your deceased
spouse died, don't determine the required minimum
distribution for that year using your life; rather, you
must take the deceased owner's required minimum distribution
for that year (to the extent it wasn't already distributed
to the owner before his or her death)."

Any basis there remaining is going to add to your IRAs basis.

You won't file Form 8606 for the decedent because there is no distribution (to the extent it wasn't already distributed to the owner before his or her death)..