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Subject:  Re: selling bonds Date:  3/31/2006  1:01 AM
Author:  WendyBG Number:  16019 of 36318

Downisland, my condolences on the loss of your Dad. As Vicki so astutely (and compassionately) observed, depression is a frequent sequel to losing a parent. Please don't rush into anything.

I had a similar situation to yours, when my mother died, in 2001. Let me share a few tips, on an inherited IRA. You may already know this, but it can't hurt to review.

1. If you paid an estate tax on your Dad's estate, the same percentage of your MRDs (Minimum Required Distributions) will be exempted from taxation, as long as you live. For example, my Mom's estate tax was 55%. Every year, at tax time, I report the full value of the MRD. Then, I deduct 55% of the amount, as a "Deduction not subject to the 2% floor," describing it as "income in respect of a decedent (IRD)," on Schedule A, Line 27.

2. You benefit most, by taking distributions based on your own age. Fidelity will calculate this for you. It's most convenient to request that Fidelity automatically distribute the MRD every year (I chose Dec. 1, to give time to correct any errors, before the year end).

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