What Is Income in Respect of a Decedent (IRD)?
IRD is income the decedent was entitled to but had not yet included in taxable income before death. It remains taxable when later received by the estate or other recipient.
What Matters Most
Common examples can include retirement distributions and accrued compensation. IRD generally does not receive the same basis adjustment that applies to many capital assets.
IRD Is Taxable Income, Not Merely an Inherited Asset
IRD can include items such as retirement-plan distributions, accrued compensation, or other income rights the decedent had earned but not yet included in income. The recipient generally reports the income when received.
Look for Related Estate-Tax Effects
Where federal estate tax was imposed on an IRD item, §691(c) can create an income-tax deduction for the recipient. That interaction is specialized and should not be overlooked in a taxable estate.
Why Professional Help Can Matter
Fiduciary taxation often depends on the governing document, ownership, timing, distributions, elections, fiduciary accounting, and state law. A qualified tax professional with actual estate-and-trust experience can help coordinate those moving pieces so requirements are fulfilled and unintended consequences are less likely.
Not Sure What Your Situation Requires?
Reviewed by Owen Arnoff, EA, NTPI Fellow
Reviewed: October 2026
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