1099r

[Kurly]

Taxpayer received a Form 1099R with a Code 4 Death Benefit. $45,000.00. She was directed before her mother died to disburse the proceeds from her retirement ($45,000.00) to eight of her mothers grandchildren. Should the taxpayer have given each of them a Form 1099-Misc or ?. She has signed receipts from the parents of the grand children, acknowledgeing that they received the monies. This happened in the tax year 2009. The IRS wants to tax the taxpayer for the full amount. ($45,000.00) What do you folks suggest that be done at this time?

Thanks

Kurly

[ChEAr$]

Taxpayer received a Form 1099R with a Code 4 Death Benefit. $45,000.00. She was directed before her mother died to disburse the proceeds from her retirement ($45,000.00) to eight of her mothers grandchildren. Should the taxpayer have given each of them a Form 1099-Misc or ?. She has signed receipts from the parents of the grand children, acknowledgeing that they received the monies. This happened in the tax year 2009. The IRS wants to tax the taxpayer for the full amount. ($45,000.00) What do you folks suggest that be done at this time?

Thanks

Kurly

Sounds like taxpayer was THE beneficiary and therefore received the entire 45,000, mother's wishes notwithstanding.

So, guess what happens now? Yep, I think you know.

[DonPriebe]

Sounds like taxpayer was THE beneficiary and therefore received the entire 45,000, mother's wishes notwithstanding.

So, guess what happens now? Yep, I think you know.

She writes a nice note to the parents of the gang of eight saying she forgot about the taxes, and would they each send her a check for $xxx.

[FEDUKE404]

meanwhile

She writes a nice note to the parents of the gang of eight saying she forgot about the taxes, and would they each send her a check for $xxx.

...and the parents of each of the eight grandchildren write a nice return note stating "thank you very much for the recent gift."

FE