If, after the death of the account holder, income was received in either the account holder's name or possibly into the Estate's name, the Estate must account for and report that income. If the Estate then, within the same year, distributed that income to the Beneficiaries, the distribution will relieve the Estate's tax liability by passing the tax liability to the Beneficiaries. A Form 1041 is needed to report the income received and if any distributions were made or deductible expenses were paid out. Generally, the Form 1041 is required for income in the amount of $600 in total or more, but for even less amounts, it is still a good idea to file the Form 1041 because it establishes the transfer of assets and income and therefore protects the Personal Representative (Executor).
This IRS write-up is an excellent resource to start learning the process:
https://www.irs.gov/businesses/small-businesses-self-employed/deceased-taxpayers-filing-the-estate-i...
Go here to use the online IRS EIN application filing system:
https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-n...
If this posted response is useful to you, please click on the upraised hand in the lower left of this post. Thank you. Scruffy Curmudgeon--PFFM/ IAFF, retired FireFighter/Paramedic - Locals 718/30, Veteran USAR O3 AIS/ASA '65-'67
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USAR 64-67 AIS/ASA MOS 9301 - O3
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