Where to claim rental income from inherited rental property that received 2 months income at end of year, house not in name yet, not done with probate yet?

[jk242]

Mother in law died in november. We are still dealing with her estate, nothing is in husbands name yet but we did receive 2 months of rental income from her tenants from a rental house in texas before end of 2017. We deposited in bank. Not sure how to claim those 2 checks. It wasn't technically his house yet, we didn't even have the death certificate yet. I need to know what sort of income this would be considered for those 2 months and where to fill it in. 

[DS30]

If the house is still in probate, then the rent for this period would be reported on the Form 1041, Fiduciary Income Tax Return. This rental income along with any other income the estate generates for this period and related expenses of the real estate and the estate administration that are deductible will be reported on this return. The estate either pays taxes on any net income or if it passes the income to the beneficiaries (which would be you), then you will be taxable on this income.

So before you can report this income on your return, an estate return (Form 1041) will need to be prepared. You will get a K-1 from the estate return filing and you will report this K-1 on your personal income tax return.

A good estates attorney can help you with the details, so be sure your attorney knows the concepts here and how to do all the required tax planning and reporting or you can use TurboTax Business, you can purchase a downloadable copy here .

[jk242]

The lawyer told husband to tell me to claim those 2 months but didn't give more info.  Next yrs taxes will be the complicated one with another house sell and investments to report. I thought I could put the two months of rent income under miscellaneous income since we received money for something not technically owned yet. I don't know that it's going to be included on any estate return form as all official estate business has taken place after the new year, so that would come with 2018 taxes. The lawyer said not to worry about anything till doing 2018 taxes, but only claim the 2 rent checks received.

[DS30]

You can still report it as miscellaneous other income on line 21 if your lawyer feels confident that this income actually is your income and not the income of the estate. Why title it as something like "other rental income received while house is probate."

[jk242]

Yeah, I've only ever had to do easy tax returns, we didn't expect his mom to die this young, it's very confusing even with a lawyer dealing with most of it. It's 2 checks and his dad who knows enough about these concepts being a business owner, told the renters to send the checks to us.

She had no will, was divorced for years and had one child, and minimal debt due which there will be enough to cover. I guess no one thought it was a problem or that the money needed to be held till after probate.
I do wish I hadn't said I'd done the taxes already, but after a day of a million questions I was just saying "yes!" to be left alone and now I've got to figure this out somehow. I don't know if it can still be claimed by the estate next year but also just extra income by us now... that sounds crazy but I don't want to under report it and when you get into these sort of taxes it's all so foreign the first time. But even the premium version didn't give me the exact option for my situation so I don't see many choices here.