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gsts529
New Member

1099 c income after death

My father died in sept of 15 . I did not file a final tax return because his income was low enough that it was not required.

I received a 1099c today dated dec of 16 for 21000 on a credit card he did not pay . He did not have assets to speak of except a life ins policy left to me for 20000

Do I need to file a tax return for this 21000 and am I liable ?

1 Best answer

Accepted Solutions
Coleen3
Intuit Alumni

1099 c income after death

Yes, you would need to file a tax return and the estate is liable for the tax, not you personally. Below are several helpful links explaining what happens tax-wise after a parent's death.

Certain estate property is exempt from income tax levies. This includes the proceeds of life insurance policies, workers' comp and unemployment benefits, and a limited amount of household goods, clothing, tools, books, furniture and real property. If an estate has insufficient non-exempt assets, then the administrator can negotiate with the IRS to reduce the lien. If, however, the administrator transfers assets to heirs without paying tax liabilities, then the IRS (and state tax agencies) will come after the administrator, personally, for the back taxes.

http://finance.zacks.com/happens-federal-income-tax-debt-person-owes-dies-6209.html

http://moneyning.com/money-management/heirs-responsibilities-after-a-death/

http://money.cnn.com/2014/06/19/pf/inherited-debt-adult-children/

https://www.irs.com/articles/death-tax-forms

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3 Replies
Coleen3
Intuit Alumni

1099 c income after death

Yes, you would need to file a tax return and the estate is liable for the tax, not you personally. Below are several helpful links explaining what happens tax-wise after a parent's death.

Certain estate property is exempt from income tax levies. This includes the proceeds of life insurance policies, workers' comp and unemployment benefits, and a limited amount of household goods, clothing, tools, books, furniture and real property. If an estate has insufficient non-exempt assets, then the administrator can negotiate with the IRS to reduce the lien. If, however, the administrator transfers assets to heirs without paying tax liabilities, then the IRS (and state tax agencies) will come after the administrator, personally, for the back taxes.

http://finance.zacks.com/happens-federal-income-tax-debt-person-owes-dies-6209.html

http://moneyning.com/money-management/heirs-responsibilities-after-a-death/

http://money.cnn.com/2014/06/19/pf/inherited-debt-adult-children/

https://www.irs.com/articles/death-tax-forms

View solution in original post

fanfare
Level 15

1099 c income after death

The issue is whether life insurance proceeds can be attached for estate tax satisfaction.
fanfare
Level 15

1099 c income after death

Oh, I did not notice your bold life insurance statement.
In that case there is no reason to file a tax return with the IRS.
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