Inherited 1099R

Forum|Forum|1 year ago
January 20, 2025
3 replies
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I receive a 1099-R distribution from my dead father's retirement plan each year and while I was under the age of 59 1/2 I included it as normal income, hence taxable income, but now that I am 60, do I still need to treat it as taxable income?

Best answer by DianeW777

Yes. This wasn't a retirement plan that you funded with 'after-tax' money from your own taxable earnings. It will be part of your taxable income as long as you receive it because it was from your deceased father's retirement plan.

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VolvoGirl

Employee

Under age 59 1/2 was the age that you would get the 10% Early Withdrawal Penalty on your own IRA or 401K withdrawals. Not for retirement plans or inherited amounts. Everything is taxable before 59 1/2 and over. Now that you are older you just won’t pay the 10% Early Withdrawal Penalty on any IRA or 401K withdrawals you take.

dmertz

Employee

Neither the age of the traditional IRA participant nor your age as recipient of the distribution is a factor in determining the amount of the distribution that is includible in your AGI. You'll report the distribution (Form 1099-R) the same as you have in the past, with the taxable amount being included on Form 1040 line 4b.

VolvoGirl

Employee

@dmertz Probably 1040 line 5a and 5b from his father’s retirement plan.

dmertz

Employee

Possibly, but this was not a lump-sum distribution. It would be unusual for an account in a qualified retirement plan (which is not an IRA) to be maintained for a non-spouse beneficiary. These are almost always directly rolled over to inherited IRAs if not just cashed out.