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Estate From 1041 -- Capital Gain/Loss Carryover

victoria1970 — Sun, 29 Mar 2020 16:45:44 GMT

My father passed away on May 30, 2019, and I'm preparing the estate’s Form 1041 as his executor.

The estate received income in both 2019 and 2020, so I plan to file an initial return for 2019 and the final return for 2020.

In 2019 the estate had capital gains in the form of dividends, and in 2020 the estate had a capital loss from the sale of real estate below fair market value. Can I carry over the capital gain from 2019 to help offset the capital loss in 2020 when I file the final return?

Thank you!

Re: Estate From 1041 -- Capital Gain/Loss Carryover

Anonymous_ — Sun, 29 Mar 2020 17:20:13 GMT

@victoria1970 wrote:
Can I carry over the capital gain from 2019 to help offset the capital loss in 2020 when I file the final return?

No, you cannot carry capital gain forward to a following tax year (with the exception of an installment sale which does not apply here).

Capital gain is reported in the year it is recognized. You will be able to, however, distribute net losses to your beneficiaries when you file the final return.

Re: Estate From 1041 -- Capital Gain/Loss Carryover

victoria1970 — Sun, 29 Mar 2020 17:55:27 GMT

Thank you!

Re: Estate From 1041 -- Capital Gain/Loss Carryover

SWSIL — Sun, 29 Mar 2020 18:04:08 GMT

Agreed - no carry over. Just remember that the estate's basis is equal to the date of death value. Unless you instructed the financial institution to update their records, your tax inform from them may be wrong.