Inherited IRA distribution question

[MattyP]

I have an inherited IRA and I have a question about the best way to take the distributions.  I do not need the money now so I was thinking that I would take the distributions and put them in my brokerage account.  I contacted Fidelity and they told me that if I roll them over, the cost basis stays the same and does not reset in the brokerage.  Does it make sense, because I have to claim the withdrawals as unearned income, to sell inside the inherited IRA and transfer cash over to the brokerage and re-purchase funds or roll over “in kind” and keep the current funds and cost basis? What is the best for when I do eventually withdraw money from brokerage?

[EvenSteven]

Any way you slice it, the withdrawal will be taxed at your marginal rate for ordinary income on the value of the withdrawal. If you withdraw in-kind the tax basis will be the value of shares at time of withdrawal. If you withdraw cash and immediately buy shares with it, the tax basis will be the purchase price. I see very little difference in doing it either way.

[MattyP]

So the cost basis does not matter so much.  The tax basis is different?

[EvenSteven]

I’m using them interchangeably here, perhaps incorrectly. The cost basis in a tIRA doesn’t matter, comming out it is taxed at your marginal rate

[GilesMM]

Does the inherited IRA have basis via non deductible contributions?