It depends on the type of income it is. 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. So, where you enter it depends on the type and or character of the income you received on behalf of the decedent.
Income in respect of a decedent must be included in the income of one of the following.
• The decedent's estate, if the estate receives it.
• The beneficiary, if the right to income is passed directly to the beneficiary and the beneficiary receives it.
• Any person to whom the estate properly distributes the right to receive it.
If you have to include income in respect of a decedent in your gross income and an estate tax return (Form 706) was filed for the decedent, you may be able to claim a deduction for the estate tax paid on that income.
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