Revenue Ruling 92- 47, 1992- 1 CB 198

AuthorSeymour Goldberg
ProfessionSenior partner in the law firm of Goldberg & Goldberg, P.C., Woodbury, New York
1992- 1 CB 198
This revenue ruling involves the calculation of the amount of IRD with
respect to the amounts payable to a nonspouse beneficiary of a dece-
dent’s IRA.
According to the facts, A died owning an IRA that was payable to his
child, B. Some of the contributions by A to the IRA had been nondeduct-
ible contributions. The entire balance in the IRA, including appreciation
and income before and after A’s death was distributed to B shortly after
A’s death.
The IRS holding follows:
• The portion of a lump- sum distribution to the beneficiary of
decedent’s IRA that equals the amount of the balance in the IRA
at the owner’s death, including unrealized appreciation and in-
come accrued to that date, minus the aggregate amount of the
owner’s nondeductible contributions to the IRA, is income under
Sec. 408(d)(1) of the Code and is income in respect of a decedent
under Sec. 691(a)(1) that is includable in the gross income of the
beneficiary for the taxable year the distribution is received. (If the
designated beneficiary had been the owner’s surviving spouse, the
surviving spouse would have been permitted, under Sec. 408(d)(3)
(c), to roll the distribution over into another IRA and avoid current
• In accordance with Sec. 691(c) of the Code, in computing income
tax for the taxable year in which the income in respect of a dece-
dent is included in income, the beneficiary may claim a deduction
for the portion of federal estate tax on the decedent’s estate that
was attributable to that income in respect of a decedent.
• The portion of the lump- sum distribution to the beneficiary in
excess of the entire balance (including unrealized appreciation,

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