QUESTION:
Dear Taxman – I am the administrator of my Mother’s estate. All she owned at the time of her death was her car, her house and a few investments which were all sold at a loss. Am I required to file an estate income tax return?
ANSWER:
Dear Reader – An estate tax return, form 1041 is not required until the income from any investments or profits from the sales of the estate property exceed $600. However, there are benefits to filing an estate return even though the estate assets are all sold at a loss.
Losses on the estate tax return can be passed thru to Beneficiaries who can then claim their share of the Estate losses on their personal income tax returns, thus saving them money!
“Ask The Taxman” originally appeared as a column in The Brunswick Citizen. All responses are written by Jim George, CPA. If you have a question for a CPA, contact us!