My mom passed away in 2007 and my brother and I equally obtained her investment portfolio of bonds and such.
A 1099 R was sent in my mom's name and the account should have been TOD divided between my brother and me but it apparently slid thru the cracks of the brokerage firm.
The 1099 has my mom's ss #. Do my brother and I have to put the interest principal and cap gains (half each) on our Federal 1040 returns or can it still go on my mom's return? There is no estate.
Thanks. W
Sorry for you loss. You would get a step-up in basis to the value of any stock at the time of you mother's death. When the stock is sold you / brother would pay tax on the capital gains from the time of your mothers death to date of sale. In any event the capital gains would be long-term. Interest on bonds up until the date of your mother goes on your mother's return. Interest on bonds after date of death goes on your / brother's return.
Hope this helps.
WDK
... But if the 1099 is in Mother's name/ssn, obviously the account has never been transferred--probably because nobody supplied the brokerage the proper notification which normally would require a certified death certificate, terms of will (unless registered w/ TOD), etc., etc., ...
While reporting income as it was distributed between inheritors is ok, you'll undoubtedly generate a letter from IRS telling you to fix the problem w/ the payor.
Based on results here of a foot-dragging lawyer never sending in a required form, it will also probably prevent IRS from having as yet marked mother's account as deceased. Just went thru it -- which reminds me, I still have to bug the lawyer--he's still not done his part after I filled out everything except a legal detail last October to try to get it done before yet another calendar year passed... :(
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