Feb 07, 2010 from
Anonymous
Value
$10.00
I received $12,700.00 from my father's IRA as an inheritance several months after his death last year. What are the tax requirements? Do I just add this to my income and pay full taxes? Are there any laws or rules regarding inheritance of this type? Thanks, Dottie
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http://www.thinkglink.com/article/2009/01/19/tax-treatment-of-inherited-ira-depends-on-distribution
Accepted Answer"The income tax you pay on an inherited IRA depends on how you receive the money. If you receive the money immediately upon the IRA owner's death then you'll be taxed at your regular income tax rate. If you roll the IRA money into an inherited IRA you have up to five years to withdraw the money and pay taxes at a marginal tax rate."
The tax depends on whether you take the money as a lump-sum distribution, or if you roll it over into an IRA.
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