Income In Respect Of A Decedent - IRD

A A A

DEFINITION

Money that was due to a decedent and will pass through to the recipient or estate as income during that tax year. The recipient (beneficiary) must declare the money as income in respect of a decedent (IRD) for any year in which income is received. The estate must also claim the income, but may claim a deduction in the amount of income tax due on the IRD.

INVESTOPEDIA EXPLAINS

While it's more common to deal with assets in an inheritance, the decedent may have had a last paycheck or unpaid commissions in transit at the time of his or her death. These items will never be reported on the decedent's income taxes and will instead be double-taxed by the recipient and the decedent's estate.


RELATED TERMS
  1. Decedent

    A person who is no longer living. Just as a taxpayer's possessions become his ...
  2. Final Return For Decedent

    The final tax return filed for an individual in the year of that person's death. ...
  3. Beneficiary

    Anybody who gains an advantage and/or profits from something. In the financial ...
  4. Irrevocable Trust

    A trust that can't be modified or terminated without the permission of the beneficiary. ...
  5. Death Benefit

    The amount on a life insurance policy or pension that is payable to the beneficiary ...
  6. Taxable Estate

    The total value of a deceased person's assets that are subject to taxation - ...
  7. Estate Tax

    A tax levied on an heir's inherited portion of an estate if the value of the ...
  8. Laughing Heir

    A distant relative who has inheritance rights despite not having a close, personal ...
  9. Ultimogeniture

    A system of inheritance whereby the youngest son gains possession of his deceased ...
  10. Crummey Trust

    An estate planning technique that can be employed to take advantage of the gift ...
Related Articles
  1. Why You Should Draft A Will
    Retirement

    Why You Should Draft A Will

  2. Getting Started On Your Estate Plan
    Options & Futures

    Getting Started On Your Estate Plan

  3. Your Will: Why You Need A Power Of Attorney ...
    Options & Futures

    Your Will: Why You Need A Power Of Attorney ...

  4. How To Plan For The Charitable Giving ...
    Investing News

    How To Plan For The Charitable Giving ...

  5. Can my spouse and children collect my ...
    Insurance

    Can my spouse and children collect my ...

  6. Must-Do Financial Moves For Same-Sex ...
    Taxes

    Must-Do Financial Moves For Same-Sex ...

  7. Financial Changes When You Marry
    Personal Finance

    Financial Changes When You Marry

  8. What Baby Boomers Need To Know About ...
    Personal Finance

    What Baby Boomers Need To Know About ...

  9. If I don't have any kids and want to ...
    Personal Finance

    If I don't have any kids and want to ...

  10. 7 Essential Questions To Ask Aging Parents ...
    Retirement

    7 Essential Questions To Ask Aging Parents ...

comments powered by Disqus
Hot Definitions
  1. Leased Bank Guarantee

    A bank guarantee that is leased to a third party for a specific fee. The issuing bank will conduct due diligence on the creditworthiness of the customer looking to secure a bank guarantee, then lease a guarantee to that customer for a set amount of money and over a set period of time, typically less than two years.
  2. Degree Of Financial Leverage - DFL

    A ratio that measures the sensitivity of a company’s earnings per share (EPS) to fluctuations in its operating income, as a result of changes in its capital structure. Degree of Financial Leverage (DFL) measures the percentage change in EPS for a unit change in earnings before interest and taxes (EBIT).
  3. Jeff Bezos

    Self-made billionaire Jeff Bezos is famous for founding online retail giant Amazon.com.
  4. Re-fracking

    Re-fracking is the practice of returning to older wells that had been fracked in the recent past to capitalize on newer, more effective extraction technology. Re-fracking can be effective on especially tight oil deposits – where the shale products low yields – to extend their productivity.
  5. TIMP (acronym)

    'TIMP' is an acronym that stands for 'Turkey, Indonesia, Mexico and Philippines.' Similar to BRIC (Brazil, Russia, India and China), the acronym was coined by and investor/economist to group fast-growing emerging market economies in similar states of economic development.
  6. Pension Risk Transfer

    When a defined benefit pension provider offloads some or all of the plan’s risk – e.g.: retirement payment liabilities to former employee beneficiaries. The plan sponsor can do this by offering vested plan participants a lump-sum payment to voluntarily leave the plan, or by negotiating with an insurance company to take on the responsibility for paying benefits.
Trading Center