Reply To: QCD and estate tax deduction

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#4955
wanttoknow
Participant

Thanks Alan,

Is the formula to which you referred the one in Example 2 on page 13 of Pub. 559?

https://www.irs.gov/pub/irs-pdf/p559.pdf

“Value included in your income
divided by Total value of income in respect of decedent
times Estate tax qualifying for deduction”

This seems to concern what portion of all deductible estate tax pertaining to an estate to allocate to a particular asset received by a particular beneficiary. For my inherited IRA the calculation of total IRD and total deductible estate tax, plus how that is divided up among multiple years of IRA distributions, was calculated many years ago.

I don’t see how to apply this formula to determining the estate tax deduction on this year’s IRA distribution reduced by the QCD.

Actually, taking the entire RMD and contributing 4.4% of it would be more advantageous income-tax-wise than doing a QCD with the estate tax deduction calculated the way I showed in my original post. I just didn’t know if that was the right way to do the calculation.