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Which TurboTax do I need to file a return for an estate?

To properly answer your question, we first need to find out if you're filing an estate income tax return (Form 1041) or the almost identical-sounding estate tax return (Form 706).

We'll explain the difference below, but if you're still not sure which return you need to file, refer to IRS Tax Topic 356.

Estate income tax return (Form 1041: U.S. Income Tax Return for Estates and Trusts)

When someone dies, their assets become property of their estate. Any income those assets generate is also part of the estate and may trigger the requirement to file an estate income tax return. Examples of assets that would generate income to the decedent’s estate include savings accounts, CDs, stocks, bonds, mutual funds, and rental property.

Form 1041 is required to be filed if there is:

  • Any taxable income for the tax year
  • Gross income of $600 or more (regardless of taxable income)
  • A beneficiary who is a non-resident alien

If Form 1041 is filed, Schedule K-1s should be generated to report this income to the heirs so they can report their share of this income on their own personal tax returns.

TurboTax Business handles Form 1041 and will also generate the K-1 schedules and figure out how much net income is allocated to the estate's heirs.

TurboTax Business is a Windows-only software program available in CD and download formats.

Estate tax return (Form 706: United States Estate and Generation-Skipping Transfer Tax Return)

Estate tax returns are filed for estates worth over $5,450,000 on the date the estate owner died.

The estate's assets and debts at the time of death are declared and tallied. If the estate's value exceeds that amount, estate taxes kick in.

Because of the complexities involved in estate tax returns (including determining what the estate is worth and whether Form 706 needs to be filed in the first place) TurboTax does not support it. Preparing an estate tax return on your own is not something you'd want to attempt anyway.

If you need (or think you need) to file an estate tax return, we strongly recommend that you consult with a CPA, EA, or tax attorney experienced in both estate planning and taxes.

Intuit TurboTax - Finish filing and get your maximum refund, guaranteed.

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