topic Form 1041 Estate in Get your taxes done using TurboTax

Form 1041 Estate

sirgalavant — Sun, 11 Apr 2021 01:37:35 GMT

My husband passed away in 2020 and received a 1099-Misc of $13k for unused vacation pay. The funds were deposited in an estate account. I've reported $13K on line 8 "Other Income" and took $200 of Other deductions on line 15a. Line 21 I claimed the $600 exemption. I'm lost as to if

I now pay estate taxes on the $13k-$200-$600=$12,200

($1904 + 35% of amount over$9450) From the 2020 tax rate schedule for 1041.

The money has been distributed to me (spouse), so can I just claim the $12,200 on my 1040 tax return? If so, what do I put 1041 Schedule B and do I need to fill out a 1041 K-1

Re: Form 1041 Estate

Anonymous_ — Sun, 11 Apr 2021 02:12:41 GMT

Yes, you get an income distribution deduction so the estate should not be liable for any federal income tax.

Rather, the income is passed through to you, as the beneficiary.

Re: Form 1041 Estate

sirgalavant — Sun, 11 Apr 2021 03:35:33 GMT

Would I need to fill out the 1041 K-1 to transfer the tax liability to me and my 1040? Or,

do I not pay taxes at all on the income distribution?

thank you!

Re: Form 1041 Estate

Anonymous_ — Sun, 11 Apr 2021 14:21:27 GMT

Yes. The estate had gross income of $600 or more so a return would need to be filed.

Re: Form 1041 Estate

sirgalavant — Sun, 11 Apr 2021 17:16:21 GMT

OK. I've completed the 1041 and my bottom line on Schedule B is $12,200.

Now I'm completing the 1041 K-1 to show the income distribution to me the spouse.

On K-1, line 10 - I put $600 for the Line 10 "Estate tax deduction", where do I put the $12,200 that was

disbursed to me? This is the initial & final 1041 being filed and the Income was IRD

(vacation pay) earned prior to death with no interest/dividends/gains earned. So, distribution of the corpus.

Re: Form 1041 Estate

Anonymous_ — Sun, 11 Apr 2021 17:48:43 GMT

The $600 exemption is not entered on your K-1; that is not part of the equation for an initial and final return with a complete distribution to the beneficiaries (only when there is net income for the estate).

If you completed Schedule B, properly, then you should have a figure for DNI.

Regardless, the distribution on your K-1 should be in the neighborhood of $12,800 (from the information you posted) and that figure would appear on Line 5 (in Part III).

Re: Form 1041 Estate

sirgalavant — Tue, 13 Apr 2021 05:24:08 GMT

thank you. This is response helped a lot.