Taxes
You must file the decedent’s final income tax return (Form 1040) for the period of January 1st to the date of death. This return is due April 15th of the year following the death.
You must file a fiduciary income tax return (Form 1041) for the period of the date of death to the end of the year or the date of distribution, whichever is sooner. This return is due April 15th of the year following the death. Since you cannot use the decedent’s social security number on this return and should not use your own social security number, you must obtain a taxpayer identification number (TIN), also known as an employer identification number (EIN), for the trust.
You must file a federal estate tax return form 706 if the decedent's gross estate exceeded the federal tax exemption or if the decedent had an AB or a QTIP or a QDOT trust. The 706 is due nine months from the date of death. Beware: An extension to file the return is not an extension to pay the taxes. If any taxes are owed, they must be paid within nine months from the date of death or substantial penalties and interest will be owed. If you do not have all of the necessary information to prepare the return within the nine months, ask your attorney or accountant to calculate an estimated amount of federal estate tax, and pay the estimated amount within the nine months.
You must continue to pay the property taxes on any trust real estate until the property is sold or distributed. The property taxes are due at the same time as ordinary property taxes. The tax returns for decedents are different from tax returns for individuals. You are strongly advised to seek the advice and/or services of a certified public accountant who specializes in the preparation of decedent returns. There are many instances where the incorrect preparation of the return has cost an estate tens of thousands of dollars in unnecessary taxes, penalties, and interest. If you need a referral to a qualified CPA, please call any of our offices.
You must file a fiduciary income tax return (Form 1041) for the period of the date of death to the end of the year or the date of distribution, whichever is sooner. This return is due April 15th of the year following the death. Since you cannot use the decedent’s social security number on this return and should not use your own social security number, you must obtain a taxpayer identification number (TIN), also known as an employer identification number (EIN), for the trust.
You must file a federal estate tax return form 706 if the decedent's gross estate exceeded the federal tax exemption or if the decedent had an AB or a QTIP or a QDOT trust. The 706 is due nine months from the date of death. Beware: An extension to file the return is not an extension to pay the taxes. If any taxes are owed, they must be paid within nine months from the date of death or substantial penalties and interest will be owed. If you do not have all of the necessary information to prepare the return within the nine months, ask your attorney or accountant to calculate an estimated amount of federal estate tax, and pay the estimated amount within the nine months.
You must continue to pay the property taxes on any trust real estate until the property is sold or distributed. The property taxes are due at the same time as ordinary property taxes. The tax returns for decedents are different from tax returns for individuals. You are strongly advised to seek the advice and/or services of a certified public accountant who specializes in the preparation of decedent returns. There are many instances where the incorrect preparation of the return has cost an estate tens of thousands of dollars in unnecessary taxes, penalties, and interest. If you need a referral to a qualified CPA, please call any of our offices.