I am helping a friend complete a 1041 for her father’s estate who died in early 2021 We are using the 2020 TT Business program just to see exactly what we need to have available so that when the 2021 program is available we can just complete the 1041.
- Her father is a US citizen residing in the US (never a Canadian citizen)
- Her father’s will has several beneficiaries include “Ted” a Canadian citizen and Canadian resident. He has no financial ties to the US, has never earned any money in the US and does not have either a Tax ID number or social security number.
- Because of a small capital gain between the time her father died and his stocks were liquidated, each beneficiary will receive some income from the estate (less than $200 each).
- All funds will be distributed b y the end of 2021 and the 1041 should be a final one
- We know we have to issue 1040-K1s to each beneficiary.
- TT Business allows for the entry of a foreign address when entering the beneficiaries, but demands either a SS number or Tax ID number to allow the forms to be printed.
- She is not planning on withholding any money for taxes for any of the beneficiaries, given the small amount of income per beneficiary.
- She is planning on having Ted complete a W8-BEN, just in case
Questions
- To get TT to print the tax return can we enter a dummy SS number ([removed]), print the K1, white-out the SS number out and enter something like “Canadian resident, Canadian Citizen” and just mail the 1041 to the IRS or do we need to get a tax ID number? With less than $200 in income as his only US income Ted should not be required to complete a 1040NR return for 2021. We tried this and got the 1041 and associated K1s to print, but not sure if IRS will accept the return
- It does not appear as though she has to file a 1042 since she is not withholding any tax, but she would like a second opinion.
Thanks in advance
