Thank you in advance for any insight into these questions.
Working on completing the 1041 for living/now irrevocable family Trust account with EIN. My dear Dad left this earth in 2014, Mom in 2022. The house and bank accounts were put in their revocable trust est2001. After Mom passed in Feb2022, the trust became irrevocable. From the 1099s for 2022, the bank accounts earned over $2k in interest. Therefore 1041 is required for 2022.
My understanding is the reporting calendar or short year would be DOD2022 to Dec31, 2022 and would need to file by April18 2023. The fiscal year reporting would be Feb2022 to Jan31 2023 and would file by May15 2023. The plan is to use calendar year since the house didn't sell until end of February2023, distributions not made and there are remaining timeshares owned by parents that need resolution.
After funeral expenses and services were paid, worked on liquidating assets. We sold 4 vehicles at FMV in Apr to Jun2022. We maintained the house (taxes, insurance, utilities, other maintenance) but then repaired the house in order to sell and spent approximately $30k, plus realtor fees, taxes and upkeep expenses. The house sold at end of Feb2023 and house funds were distributed to beneficiaries in Mar2023.
For tax year 2022:
1) Report the income from interest 1099-INT.
2) Are funeral expenses and services deductible, if so what form and where?
3) Report parents vehicles sold, they sold for less than FMV so no gain but there is a loss. How to report on 8949 and Schedule D of 1041 in Turbo Tax Business? The 3 vehicles were titled under the parents name, the 4th vehicle was titled under Mom with TOD the trust.
4) Are house maintenance expenses deductible? If so which form and where?
Do I report all the house selling expenses now or wait until tax year 2023, if so which form and where? Believe selling expenses will be reported in 2023 with sale of house.
For tax year 2023, I have Comparative Market Analysis (CMA) from our realtor for each period identified below. What will be the cost basis for the house?
- FMV 50% from 2014 when Dad left and 50% from 2022 when Mom left
- FMV 100% when Mom left
