Yes, that is true. Inheritance is usually not taxed if the income tax for the deceased person was filed and paid or refund collected by the estate before the distribution of remaining funds after probate. This did not happen. The funds were distributed 8/22 and the income taxes were not done first.
So a schedule k-1 of form 1041 is the distribution of income tax liability for the beneficiaries who received a portion of the income from the year of death. In this case, my mother's house was sold so there will be capital gains income tax on that sale that will need to be distributed across all recipients (beneficiaries) of the proceeds. Along with 3 months of income for Jan, Feb, and Mar.
Heaven only knows if my sister even thought to see if mom had had a chance to file her 2021 taxes before passing. But she knows it all... so what ever.
@fanfare
