Form 1041 $600 estate exemption

[1234dogface]

The financial institutions refused to re-issue 1099INTs in the name of the estate, or even the Joint Owner on the savings accounts.  The estate is very small, in the thousands in savings accounts- no other income.  I  have distributed all taxable interest income to the single beneficiary (who is also Joint Owner-because the decedent was listed as primary with his SSN), except for $600. Using the decedents SSN on his 1040SR Schedule B, nominee interest was shown as deducted to the respective nominee, then  form 1096 and 1099INT is to be mailed tomorrow applying $600 to the Estate EIN, with the $$ balance accompanying 1099INT for the beneficiary/joint owner.  The Estate EIN will then have a total $600.  I know there is a $600 exemption, does that mean no schedule k-1 will need to be issued?

[DavidD66]

An estate tax return is required if the assets of the estate generate more than $600 in income.  An estate must issue a Schedule K-1 (Form 1041) to each beneficiary who receives a distribution of the estate's income, deductions, or credits. 

[1234dogface]

Thank you for the reply. Further, may I ask, since the banks would not re-issue the 1099INT in the name of either the Estate, nor the Joint Tenant on the account, the Schedule B of the final 1040sr tax return up to the day before death, reflected post-death nominee interest deducted from other banking interest with $600 nominee to the Estate EIN, and the balance to the joint tenant SSN on the accounts- thus the Estate actually had only $600, which is exempt with no further interest to distribute, thus there is no interest to mention on line 1 of the form 1041 schedule k-1-- therefore why would the IRS object to no issuance of a k-1?  All of the documents show the paper trail of the interest. Please let me know what you think? Thanks

[DavidD66]

If I understand correctly what you are saying in your question, I would not file a 1041 Estate Tax Return in this situation.  Just make sure the interest (and any other income, if there is any) is reported on either the decedent's tax return or the beneficiary's tax return.  If that's done, I see no reason to file the 1041.  

[1234dogface]

WOW!!!  Thank you for the reply. I had thought of doing just that, but I prefer to be prudent with the IRS so I would have filed as stated- mistakes are not worth the aggravation. Best to you-- Enjoy the tax season.