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Solved

Would the proceeds from the sale of personal property in an estate be listed as a distribution K1's?

Forum|Forum|6 years ago
April 13, 2020
5 replies
45 views

Items sold include automobile (below FMV), furniture, other personal property.

TurboTax Business Windows

Best answer by MaryK4

Yes, if there is no gain on the sale of personal property, it does not get reported.

Alumni - Intuit

Publication 559 (2019), Survivors, Executors, and ... says:

Character of income.

The character of the income you receive in respect of a decedent remains the same as it would have been to the decedent if he or she were alive. If the income would have been a capital gain to the decedent, it will be a capital gain to you.

Please see About Form 1041, US Income Tax Return for Estates and Trusts says:

Decedent's estate.

The decedent's estate is an entity that is formed at the time of an individual's death and generally is charged with gathering the decedent's assets, paying the decedent's debts and expenses, and distributing the remaining assets. Generally, the estate consists of all the property, real or personal, tangible or intangible, wherever situated, that the decedent owned an interest in at death.

It sounds like the car would not be included. The furniture and other personal property would be determined by cost basis vs sales price. If you sell an antique family item for $10,000, that could be taxable, depending on the basis. For most people, there is not a taxable amount on personal belongings.

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TX516Author

Level 2

So to clarify, there isn't any capital gains as all items were sold at or below FMV (fair market value). So the little bit of money received from selling the furniture/used auto, is not reported as a distribution on the K1 then. Is this correct???

MaryK4Answer

Alumni - Intuit

Yes, if there is no gain on the sale of personal property, it does not get reported.

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