Income In Respect Of A Decedent
Updated: 07 November 2024
What Does Income In Respect Of A Decedent Mean?
Income in Respect of a Decedent (IRD) refers to money owed to a person who has already passed away. This income is transferred to the estate or beneficiary, but it must be declared as part of the deceased person’s property. The person who claims the IRD will be required to pay taxes on it.
Insuranceopedia Explains Income In Respect Of A Decedent
Income in Respect of a Decedent (IRD) can arise from sources such as retirement benefits, unintentional posthumous payments, or late payments for services and products.
Since IRD cannot be collected by the intended beneficiary directly, it is instead transferred to the decedent’s estate as part of their property. The person who claims the IRD will be taxed on it, and it should be specifically classified as IRD on tax forms.
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