1099R Question
Husband died 2010 before taking RMD, had 2 IRAs. Wife made the election to step into his shoes for both IRAs after taking his RMD out of each. Got the 1099Rs- both banks coded Distribution Code 4, which means death, in Section 7. Is that correct?
Also, one bank now has the wife’s name on the 1099R in the recipient box, which is what I was expecting, while the other bank’s 1099R has the wife’s name followed on the next line by the phrase Bene of [deceased husband’s name]. Is this ok/ correct for someone who made the spousal election to step into the deceased’s shoes? Note: I have copies of the paperwork filed with the bank, and the election was made correctly.
Thanks for any help.
Permalink Submitted by Alan Spross on Thu, 2011-03-03 21:31
Code 4 is correct for any distribution made to a beneficiary and will eliminate any early distribution penalty even if the beneficiary is under 59.5. This reflects that the distribution was made prior to ownership assumption.
The difference in the recipient’s listing is not important and just reflects the system of each issuer. The critical box here is the SSN which should be that of the beneficiary who received the distribution. That difference also does not reflect whether or not the account ownership assumption was properly recorded after the distributions were made. If you don’t have paperwork such as account statements recently issued that show the surviving spouse currently as owner, then that needs to be corrected.
Meanwhile, there should be no problem properly filing the 2010 tax return including the 1099R distributions made in 2010.