If you inherit IRA assets from someone other than your spouse, you generally have two options from which to choose: direct transfer of the IRA to a special type of IRA called an inherited IRA, or take cash distributions as taxable income.hen you establish an inherited IRA, it's important that the IRA custodian registers the account properly. The account registration should include: 1  the name of the person who died; 2  an indication that the account is an IRA beneficiary distribution account; 3  the inheritor's name.