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MariaSol
Returning Member

Deceased passed 07/27/20 tax software not letting me continue because death was before 01/01/2020

I am at personal Info Question #3, after saying I am preparing this for a deceased individual (I am court appointed for my passed cousin) and entering the death date of 07/27/20 of the past year I get a red message saying the death Cannot be before 01/01/2020.

This seems like an error where the year has not been updated to 2021. Is there a way to resolve this or am I going to go get paper copies?

1 Best answer

Accepted Solutions
DMarkM1
Expert Alumni

Deceased passed 07/27/20 tax software not letting me continue because death was before 01/01/2020

You must enter the date as 07/27/2020, not 07/27/20.  It will only read the full year.

 

 

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3 Replies
DMarkM1
Expert Alumni

Deceased passed 07/27/20 tax software not letting me continue because death was before 01/01/2020

You must enter the date as 07/27/2020, not 07/27/20.  It will only read the full year.

 

 

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**Mark the post that answers your question by clicking on "Mark as Best Answer"

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Billl2021
Level 1

Deceased passed 07/27/20 tax software not letting me continue because death was before 01/01/2020

I had the same problem but the date of death was 12/04/2019 and TurboTax would not accept a date earlier than 01/01/2020.  The person had investment income reported for 2020 that occurred before an estate account could be created.  Having investment income in the year following the year the taxpayer passes seems like something that could occur with anyone who dies near the end of the year.

DawnC
Expert Alumni

Deceased passed 07/27/20 tax software not letting me continue because death was before 01/01/2020

Only income earned between the beginning of the year and the date of death should be reported on the final return.  

 

For taxpayers who use the cash method of accounting, as most do, income is considered earned as it is actually received or at least made available to them. Taxpayers who use the accrual method of accounting, on the other hand, count income as earned when they actually earn it, regardless of when they receive it.

 

The distinction is important because some income that might logically seem to belong on the decedent's final return is considered income in respect of a decedent (defined below) and is taxable either to the estate or to the person who receives it.

 

Income in respect of a decedent refers to income that the decedent had a right to receive at the time of death, but that is not reported on his or her final return. It does not include earnings on savings or investments that accrue after death.

 

Say a taxpayer who has a substantial amount in money-market mutual funds dies on June 30th. Only interest earned up to that date would be reported on the final tax return. Earnings after that date are taxable to the beneficiary of the account, or to the estate.     @Billl2021   I am sorry for your loss.

 

The IRS expects a final accounting, and it's up to the executor or survivors to file the paperwork. Here's what you need to know about the deceased's final tax return, reporting income and deductions, inheritance and more.

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