IRD asset

The income in respect of a decedent (IRD) asset is part of inheritance which consists of taxable income to which the deceased person was entitled to, but failed to receive before their death. A typical case is the last paycheck, which may be left not received.

Most of inherited property is not included in an heir’s taxable income, but IRD assets do.

While the tax basis of most of a decedent's assets are "stepped up" for income tax purposes, IRD assets are not eligible for a "step-up" in basis, and hence may lead to double taxation, and an income tax and estate tax.