If you are a person who has been named as the beneficiary of an IRA, then you have some decisions to make. They need to be good decisions or it could end up costing you, according to the Wills, Trusts & Estates Prof Blog in "Practical Issues When an IRA Owner Dies."
Because IRA accounts are given to beneficiaries directly and are not part of the estate, they do not go through probate.
However, the importance of IRAs to overall inheritances can be enormous. Therefore, it is vital that their administration be carefully considered.
The biggest thing to understand is that there are tax consequences for any decisions made about what to do with the IRA. Those consequences are not the same for everyone.
They depend on the relationship between the beneficiary and the deceased. These tax consequences are big enough, that it is important to seek professional tax advice and to do so quickly.
There are penalties, if decisions are not made within certain time limits.
If you are not certain who to talk to about what to do with an inherited IRA, then talk to the attorney who is assisting with the administration of the estate. He can point you in the right direction.
Reference: Wills, Trusts & Estates Prof Blog (Oct. 4, 2017) "Practical Issues When an IRA Owner Dies."