My father-in-law passed away several years ago. He had money in an irrevocable trust. Then my mother-in-law passed away in 2019. Her estate, which included my father-in-laws trust, was settled in 2020. I have a 1099-R in my father-in-law's name so I'm of the assumption that we have to file taxes for him. I'm in TT and trying to enter his date of death. When I do, it says the date has to be in 2020. What do I do here??
That should probably be part of the irremovable trust's final tax return or the estate's tax return. Check with the attorney handling the estate. If the annuity was part of your mother-in-laws estate, then the income would be reported on her estate tax return and flow out to the beneficiaries through the final K1. Whoever prepared the estate tax return should have included the annuity or IRA income on that return. Check the social security number on the 1099R. Make sure it is your father in laws and not the trust EIN. But I would start with checking with the estate's attorney. You should not have to file a tax return for your father-in-law that deceased years ago.
I checked my mother-in-law tax return and the trust was on her taxes. The tax id on the 1099R & is the same as the EIN listed for the trust in her taxes. So it appears that I should be filing my father-in-laws 1099R along with my mother-in-laws 2020 taxes, since her estate was settle in 2020.
Before you do that, check with whoever prepared the final trust tax return and estate return. They may have already included the income from the 1099R in one of those returns. You do not want to be including the income twice if it has already been claimed either on the final trust tax return or through your mother-in-laws estate return. Additionally, if the 1099R is in the Trust EIN, the trust should have claimed the income. Before you include it on her return, make sure it was not included on either the Trust or Estate tax returns.
After speaking with a few people it seems that I may have more to do with this. It seems that we may have to file 'trust returns' for both estates so that beneficiaries get K1's. Then I'll have to file and return for my father-in-law's estate and one for my mother-in-law. Anyway, at this point we will seek help from tax professionals. Thank you!