My recently deceased spouse's IRA has been rolled over into mine. Does the cost basis change for me?

By Denise Appleby AAA
A:

The basis attributed to IRA assets that you inherited remains the same. Since you are a spouse beneficiary and you elect to treat the assets as your own by transferring them to your own IRA, the basis is now treated as if you made the non-deductible contribution. Going forward, you should file Form 8606 to determine the taxable portion of distributions you receive from any of your Traditional IRAs. If you also made non-deductible contributions to your IRA, the basis from the inherited assets should be combined with your basis.



This question was answered by Denise Appleby
(
Contact Denise)



RELATED FAQS

  1. What effect will a prenuptial agreement have on a 401(k)?

    Courts have ruled that a prenuptial agreement for qualified plan (including 401(k)) assets is invalid. The logic is that ...
  2. Is there a limit on how much I can move from my IRA to my Roth IRA?

    There is no limit on the amount that can be converted from your Traditional IRA to your Roth IRA. As you may already know, ...
  3. I have a small business, and I'm considering setting up an SEP IRA. What are leased ...

    Generally, a leased employee is the employee of an outside organization from which you lease the employee's services. For ...
  4. If I participate in my company’s SIMPLE IRA plan, can I also contribute to ...

    Because the SIMPLE IRA contribution limits are much lower than the 401(k) limits, it might at first seem unfair that you ...
RELATED TERMS
  1. Gold IRA

    Definition of Gold IRA
  2. Eligible Transfer

    An IRS-allowed movement of assets into or out of an individual ...
  3. Leveraged Benefits

    The use – by a business owner or professional practitioner – ...
  4. Peri-Retirement

    A term for the period of time leading up to actual retirement. ...
  5. MyRA

    A new tax-advantaged retirement account that President Barack ...
  6. Provident Fund

    A compulsory, government-managed retirement savings scheme used ...
comments powered by Disqus
Related Articles
  1. Should You Convert Your IRA?
    Retirement

    Should You Convert Your IRA?

  2. Why Your Will Should Name Designated ...
    Home & Auto

    Why Your Will Should Name Designated ...

  3. Changes In Tax Legislation And Regulation
    Taxes

    Changes In Tax Legislation And Regulation

  4. New Retirement Plan Limits For 2011
    Taxes

    New Retirement Plan Limits For 2011

  5. Are Equity-Indexed Annuities Right For ...
    Savings

    Are Equity-Indexed Annuities Right For ...

Trading Center