Executor Fee Income

[tddengler]

I received a portion of the executor fee in 2023 and will receive the rest in 2024.  Do I report what I rec'd in 2023 on this year's return and if so where do I report it?  I did not receive a 1099.  

Also, I heard that executor fees are not taxable unless they exceed the estimated value of your time spent on the job.  I've kept good records of the hours I spent doing executor work, can I reduce the taxable amount with those records?

[DaveF1006]

Use this IRS tool to determine if your executor fees are taxable or not. If some of all are taxable, report that here.

1. Log into your account
2. Select Wages and income>other income
3. Miscellaneous Income, 1099-A, 1099>start
4. Scroll to the bottom of the page to Other Reportable Income
5. Other taxable income, answer yes
6. Then give a brief description of the income and the amount listed.  Here the description would be executor fees.

[tddengler]

Thanks, that answered both of my questions.  I don't know why but there was a comment on a website that said you only have to pay tax on the portion of the executor fee that exceeds the hours you actually spend working on the estate.  That may be for paid executors?

[DaveF1006]

I do not see that reference anywhere on the IRS websites or in the tool. Any tax advice given must first be addressed in an IRS publication or in actual case files.  I did see the reference you are referring to in the following website but this not an authoritative reference and I can't find any basis for it in any IRS documents. 

Now, state laws can vary from state to state and it could be possible that it isn't taxable in the state where you live.

[simonsaba]

How do you enter this information in the TurboTax Deluxe desktop version? I tried going directly to Forms -> Schedule 1 Line Z where the IRS says that this information should be entered but was unable to enter the information by clicking into the appropriate fields. In EasyStep, there is no Other Reportable Income link.

[MarilynG1]

In Easy Step mode, on the Wages & Income listing of topics, scroll all the way to the bottom, to 'Miscellaneous Income, 1099-A, 1099-C'.

On the next screen, again scroll all the way down to 'Other Reportable Income'.

The next screen titled 'Other Taxable Income' gives a space for a description of the income, and amount. 

@simonsaba