Handling an Unneeded EIN for an Estate

[gxt1]

The Wife's mother passed, no real property, small estate but there was one account with no beneficiary and I was told (initially) I would need Letters Testamentary which requires Probate. Too small of an account for an attorney, was going to do it myself and as part of the process, I got an EIN from the IRS. I later found out I could get around probate (at least in Washington State) by using the Small Estate Affidavit form. The goal was accomplished, no probate required.

While a little premature I don't believe there will be $600 of taxable estate income, since the value of the accounts is stepped up to be their value at the date of the mother's passing and only an incremental gain after the date of her passing (dividends, interest or capital gains) would be the taxable components.

Two Questions;

1. When I got the EIN from the IRS it came along with a sentence indicating a requirement to file a 2024 Estate Tax 1041. Regardless of that ominous message (which was as stated by the IRS "based on the information received from you") if there isn't $600 in estate income it appears I wouldn't need to file a 1041?

2. If there isn't $600 in Estate attributable income would it be a good idea to send a letter to the IRS (with an explanation) asking them to deactivate the EIN?

  Thanks Much for any thoughts.

  p.s. I do know if I had to file an Estate 1041, I would need the TurboTax Business edition (not to be confused with the Home and Business edition)

[M-MTax · Accepted solution]

    Don't be concerned with the EIN or letter from the IRS.....it's a standard form letter sent to those who apply for an EIN. You don't need to "deactivate" an  EIN.

     If the estate doesn't have $600 or more in gross income there's no filing requirement BUT it's a good idea to file a 1041 anyway and mark the return as final. 

[gxt1]

@M-MTaxThanks so much. If filing a final 1041 is a good idea (and there is much of nothing for the estate), I will try doing a 1041 by hand and mailing it in. I just downloaded the 1041 and gave it look and it doesn't look complex for my needs.  I normally use TT premium which includes the one state return (nothing to do with the estate taxes, personal only, for a non resident state), I'd just prefer not getting my personal linked up with a more complex version than necessary and then having to buy the state ad-hoc (to complete the personal taxes).

Worst case, TT is always good about offering to sell a version upgrade.

    Thanks Again!

[rjs]

As you stated in your original question, to file a Form 1041 tax return for the estate you would need TurboTax Business. But that has nothing to do with your personal Form 1040 tax return. You cannot use TurboTax Business to file your personal tax return. You would need two separate TurboTax products - TurboTax Business for the estate, and Premier (or whatever version you want) for your personal tax return. Using TurboTax Business for the estate does not complicate your personal tax return.

You cannot upgrade from Premier to TurboTax Business. They are two separate products.

Also note that Premium is a TurboTax Online edition. The Desktop TurboTax Editions are Basic, Deluxe, Premier (not Premium), and Home & Business.

[gxt1]

@rjsYour are right sir, I use Premier which I misstated as Premium. My mind was lost in the void of tax research, or maybe it was the 90 minutes on hold with the IRS (without an answer), either way, my bad.

I did not know that TT Business would not let you do personal taxes, that is incredibly helpful and what a surprise that would have been! Thank you!