What are the steps for filing a decedent's estate income tax return?
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- Опубліковано 6 вер 2023
- Navigating the Intricacies of a Decedent's Estate Income Tax Return
A loved one's death brings about a variety of responsibilities for those left behind, and one such obligation is the filing of the decedent's final income tax return. Many find this daunting, but understanding the process can alleviate some of the stress.
Board-certified Tax, Estate Planning, and Probate attorney John Strohmeyer is here to explain what you need to know when filing and wrapping up an estate with the IRS.
We'll cover:
When to File the Decedent’s Final Income Tax Return
What Gets Filed in a Decedent's Estate Income Tax Return
Tips for Missing Tax Returns
Key Steps to Follow:
Losing a loved one is hard. The subsequent administrative tasks, including taxes, can seem like an extra burden. However, with the right information and possible professional assistance, this responsibility can be managed efficiently.
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Strohmeyer Law is a law firm based in Houston, Texas, specializing in tax law, estate planning, and probate law.
Nothing in this video is specific legal advice for you. Watching or commenting on this video doesn't create an attorney-client relationship.
For more information, visit: www.strohmeyerlaw.com
Instagram: strohmeyerlawpllc
if the estate receives a 1099-r (distribution code Q) for the distribution of all funds from a roth ira, and those funds are passed to the beneficiary, does the beneficiary need to claim that amount as income and is it claimed as other income on the K1 form?
Generally, if income is received by an estate, and then distributed to the beneficiary in the same year, then the beneficiary will be responsible for the income taxes. You’ll need to talk to your own advisor to get specific answers about your situation.
A decedent's estate holds onto the decedent's home for two year after death, and then sells it. The house appreciates in value over the course of the two years. When the estate files its 1041, does it pay the long term capital gains tax from the proceeds of the estate? Or does it pass the tax liability on to the four equal heirs via a K-1?
Capital gains are generally paid by the fiduciary, but they can be paid by the beneficiaries if they’ve been distributed. You’ll need to work with your own advisors to determine the appropriate course for your specific circumstances.
I am the administrator of the estate of my deceased husband. I and my deceased husband were separated for two years before he passed away, and I was filing my tax returns separately. He passed away in May 2021. He was in jail for almost two years before he passed away. My husband was getting disability income when he died, but I do not know if he has filed for tax returns after we separated. I am the administrator of the estate and have sold his property and need to file 1041. Please advise me on what I should do. Thank you very much.
I'm sorry to hear about this, and you will need to get your own advisor to help you sort this out. We can't give advice about specific situations on UA-cam. Please consult with your own advisor about your specific circumstances.
What if someone is on disability or social security do they still have to file because that's their only income
It depends on how much total income they have. Talk to your own advisor about your specific circumstances.
Say for instance social security was the only income they had
@@jasonmiller270 You'll need to talk to your own advisor about your specific circumstances.
When preparing a 1041, does the refund from decedents individual tax return count as income in regards to estate income tax?
It depends. The estate tax return generally doesn’t look at the estate’s income, but depending on the circumstances it’s possible it needs to be included. You’ll need to consult with your own advisor about your specific circumstances.
What steps would someone take if the decedent did not file the previous years taxes and you are responsible for filing the final year tax return?
I have spoke with the CPA office and they confirmed she did not file taxes for the previous tax year, I cannot get her tax preparer to return my calls.
You may need to get another tax preparer. It’s possible for them to request the information that the IRS has to prepare any missing returns so you can close that out.
Can the 1041 be filed after the estate has been closed with the state? Would the executor still sign the return?
It will depend on the state. Estates typically are not formally closed in Texas, so it’s not an issue here.
At about 2:38 in the video, you say (correct my paraphrase here if needed) that if the deceased’s income gets distributed out to the beneficiaries, then the income tax on it will be paid by the beneficiaries”. To limit discussion to income in the form of dividends and interest in accounts that have Transfer-on-Death or Payable-on-Death provisions set up for the beneficiaries: the 1099’s for the beneficiaries for their inherited accounts *should* include income starting the day after death (right?). This assumes timely notice of the death to the financial institutions. If that is true, then there is no income from these accounts retained by the estate after the death that will necessitate an estate EIN or a Form 1041, is that correct? Thanks!
As you’ve described for transfer on death accounts, the estate would never have been entitled to the income. You’ll need to discuss your specific circumstances with your own advisors.
Thanks very much for the timely reply!@@strohmeyerlawpllc
can you file a 0 estate return?
You could. Why would you want to do that?
my question is if they passed at the end of December what do you file?
@@mquiralte1 You will file the final Form 1040, and if the decedent received $600 or more after 12/31 then Form 1041 will need to be filed.