How Should an Inherited IRA Account Be Titled? The FBO Format, Exactly

Guides · Updated October 2026

The brokerage's account-opening screen offers you "Rollover IRA" and "Beneficiary IRA," and neither label explains what happens if you pick wrong. What matters is how the account gets titled. The answer is a specific string of names and words, and the penalty for improvising is that the entire account becomes taxable in a single year.

The exact format

Most custodians use this format.

[Deceased Owner's Name], Deceased, IRA FBO [Beneficiary's Name], Beneficiary

A concrete example: if Jane Smith leaves her IRA to her son David Jones, the new account reads "Jane Smith, Deceased, IRA FBO David Jones, Beneficiary." FBO means For Benefit Of. The IRS instructions for Form 5498 use a slightly different phrasing as their example, "Brian Willow as beneficiary of Joan Maple," which tells you the exact word order matters less than the three elements that must appear somewhere in the title:

The original owner's full legal name, so the IRS can trace the assets back to their tax-deferred source.
Your full legal name as beneficiary.
A clear marker distinguishing it from your own accounts: "Beneficiary," "Inherited IRA," or "Beneficiary IRA."

How should an inherited IRA account be titled in each situation

Non-spouse beneficiary. Use the FBO format above. You cannot roll the assets into your own IRA, you cannot add new contributions, and you must move money only by direct trustee-to-trustee transfer. If you take a check in your own name, that is a taxable distribution that cannot be redeposited.

Spouse who rolls over. The FBO title is not used. The assets move into your own IRA and the account is titled in your name alone, as if the money had always been yours.

Spouse who stays a beneficiary. Use the FBO format. Some younger spouses prefer this when they need access before age 59 and a half, because beneficiary distributions avoid the early-withdrawal penalty.

Successor beneficiary. When you inherit from someone who already inherited, the original owner's name drops off and the previous beneficiary's name takes its place. If you are inheriting from a beneficiary named Patty Covington, the account reads something like "Matt Kelly as Beneficiary of Patty Covington."

The expensive mistake. If you retitle the account in your own name alone, and you are not a spouse electing a rollover, the custodian may report the entire balance as a taxable distribution on Form 1099-R. Years of tax-deferred growth land in one tax year, usually at your highest marginal rate. This is also the trap when moving an inherited IRA to a new brokerage: open the wrong account type online, and the damage shows up months later when the tax forms arrive. If you do not see a dedicated inherited or beneficiary IRA option, call before you click anything.

My take: the titling rule looks like paperwork fussiness, but it is the load-bearing wall of the whole inherited IRA system. The title is what tells the custodian to apply the 10-year rule instead of treating you as the owner. Get the string right once, keep the date of death accurate on every form, and the rest of the distribution rules work the way they are supposed to.

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Frequently asked questions

How should an inherited IRA account be titled?

The deceased owner's name, followed by Deceased, then IRA FBO the beneficiary's name, Beneficiary. For example: John Smith, Deceased, IRA FBO Jane Smith, Beneficiary. The three required elements are the original owner's name, the beneficiary's name, and a marker like Beneficiary or Inherited IRA.

What does FBO mean on an inherited IRA?

For Benefit Of. It signals that the account is held in the deceased owner's name for the beneficiary's benefit, preserving the inherited status for IRS reporting and RMD rules.

What happens if I title an inherited IRA in my own name?

If you are not a spouse electing a rollover, the IRS may treat the retitling as a full taxable distribution of the entire balance in that year. Always keep the deceased owner's name on the account.

Does a spouse inheriting an IRA use the FBO title?

Only if the spouse chooses to remain a beneficiary. If the spouse rolls the assets into their own IRA, the FBO designation is not used and the account is retitled in the spouse's own name.

How is an inherited IRA titled when the beneficiary dies and a successor inherits?

The original owner's name drops off and the previous beneficiary's name takes its place, for example: Matt Kelly as Beneficiary of Patty Covington. The successor remains subject to beneficiary distribution rules.

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