20 Year Old Inherited IRA
Taxpayer’s mother died in 2000. Now she discovered that her Mom left her a traditional IRA that, until now, she knew nothing about. The recent account value is about $40,000. What should the taxpayer do and how to report?
In follow up to the original post, the mother’s DOB is 3/3/1930. She passed on 11/9/2020. The client taxpayer was 45 when her Mom passed. Taxpayer is the sole heir. There were 2 other traditional IRA’s from this same custodian and the daughter was listed as the sole beneficiary. But this third TIRA listed the estate as the beneficiary and for some reason the daughter was never notified about this third IRA. You’re right, the custodian should have escheated the funds to the state after a few years, but that step was skipped too. Basically the custodian did not do its job. So here we are now in 2021 with a $40K IRA to deal with. Besides moving the account to a better trustee, what shoud the taxpayer do and how should the distributions be reported?
Permalink Submitted by Alan - IRA critic on Tue, 2021-08-03 16:53
Did mother pass prior to her RBD or after? What was taxpayer’s age in 2000? It also strikes me as odd that this IRA has not been escheated to the state many years ago. So how did she find out about this account now?