cancel
Showing results for 
Search instead for 
Did you mean: 
Highlighted
Level 1

For a federal 1041 for an estate, do I need to file K-1 with the 1041 and do I need to use each individuals social security number?

I am the executor for an estate and trying to get ready to file the first and final 1041. The taxes on the income from the estate will be paid by the estate. Not sure if I have to produce K-1 with each beneficiary's distribution since it should not be taxable to them.

1 Best answer

Accepted Solutions
Level 20

For a federal 1041 for an estate, do I need to file K-1 with the 1041 and do I need to use each individuals social security number?

"The taxes on the income from the estate will be paid by the estate. "

 

If the taxes are going to be paid by the estate, there is no reason to generate K-1s (unless there are credits, capital losses, deductions, et al, to be passed through to the beneficiaries).

 

If you do need to generate K-1s, then you do need the social security (tax ID) numbers of the beneficiaries.

 

It is also good practice to make the beneficiaries aware that they have no income tax liability on the distribution(s) if the estate will pay all of the tax due.

3 Replies
Level 20

For a federal 1041 for an estate, do I need to file K-1 with the 1041 and do I need to use each individuals social security number?

"The taxes on the income from the estate will be paid by the estate. "

 

If the taxes are going to be paid by the estate, there is no reason to generate K-1s (unless there are credits, capital losses, deductions, et al, to be passed through to the beneficiaries).

 

If you do need to generate K-1s, then you do need the social security (tax ID) numbers of the beneficiaries.

 

It is also good practice to make the beneficiaries aware that they have no income tax liability on the distribution(s) if the estate will pay all of the tax due.

Level 5

For a federal 1041 for an estate, do I need to file K-1 with the 1041 and do I need to use each individuals social security number?

How do you handle having the taxes paid by the estate?

I'd like to do that for my mom's estate and trust, but I don't know how to work out having the taxes paid.  Any help would be appreciated.

Level 20

For a federal 1041 for an estate, do I need to file K-1 with the 1041 and do I need to use each individuals social security number?


@sallywing wrote:

How do you handle having the taxes paid by the estate?

I'd like to do that for my mom's estate and trust, but I don't know how to work out having the taxes paid.  Any help would be appreciated.


In a nutshell, the estate and/or trust can pay any income taxes due in the process of preparing the Form 1041 for those entities, unless the documents (will/trust) dictate otherwise.

 

However, if distributions are made to beneficiaries, then DNI (distributable net income) will be carried through to the beneficiaries on their Schedules K-1. 

 

If the next question is "what is distributable net income?", then, as I stated in another post, you need help with preparing these returns. Please seek professional tax guidance and return preparation.