Upon the passing of an individual, multiple tax filings may need to be completed depending on the financial situation of the decedent and their estate.
The two most common filings that will need to be completed promptly are the individual’s tax return and the estate’s income tax return.
Individual Tax Return
According to the IRS (Internal Revenue Service), filing a decedent’s tax return is generally done the same way as if they were still alive. Accordingly, you would report all of the income, credits, and deductions to the IRS up to the date of death.
If the deceased had not filed a return for previous years, you as the executor are obligated to file those as well.
Finally, if any taxes are owed it is the executor or administrator’s responsibility to pay those, along with receiving any applicable tax refunds.
To expedite the process for you, below are some of the forms required for the aforementioned filings:
Type of filing | Form(s) required |
Current year return | 1040 or 1040-SR |
Previous years return | 4506-T |
Claiming a tax refund | 1310 |
Estate Income Tax Return (income generated from estate assets)
In keeping with IRS guidelines, if your loved one’s estate generated above $600 dollars in annual revenue then you will be required to file Form 1041.
As you may already be aware, when an individual dies, any assets or property they own generally belongs to the estate (except if a lady bird deed was used to transfer property–for instance).
These assets may be able to generate income and if so, this income will need to be reported to the government. Here’s a brief list of types of assets that may produce income:
- Bonds
- Mutual Funds
- Stocks
- Savings Accounts