So there is an estate that was opened in 2023, and will close at some point based upon your fact pattern below. To the extent that the estate had income exceeding $600 in a given year (2023, 2024 and maybe 2025?) it may have filed an estate tax return with the IRS, which is a 1041, but from your fact pattern, I question, whether there was much income at all.
Generally distributions from an estate to a beneficiary are tax free. Since this is the residual of the estate after paying off the debts, and there do not appear to be any appreciating assets, there should be no tax implication when the estate is closed and you received the residual.
I think I limited that question to the tax implications. Thank you for your question @sap3
All the best,
Marc T.
TurboTax Live Tax Expert
27 Years of Experience Helping Clients
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