I had expenses as the executor of an estate. Is this deductible?

[tagteam · Accepted solution]

"Is this deductible?"

Yes, but the ordinary and necessary expenses incurred are deductible by the estate on its 1041 (if one were filed). Regardless, the executor is entitled to reimbursement from the estate for any out-of-pocket expenses.

[skidude]

How are expenses not claimed by the Estate deducted on an Individual 1040, Schedule A? Schedule C (if already an LLC operator not in the business of managing estates, but self-employed contractor)?

[tagteam]

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@skidude wrote:

How are expenses not claimed by the Estate deducted on an Individual 1040, Schedule A? 

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Other than estate taxes (Line 16), except in unusual circumstances the expenses are not deductible by an individual on Schedule A; the estate can reimburse the individual for an expenses paid on behalf of the estate.

[skidude]

Any idea what "unusual circumstances" may include? - Thanks!

[tagteam]

• Gambling losses. 

• Casualty and theft losses of income-producing property.

• Federal estate tax on income in respect of a decedent.

• A deduction for amortizable bond premium.

• An ordinary loss attributable to a contingent payment debt instrument or an inflation-indexed debt instrument.

• Deduction for repayment of amounts under a claim of right if over $3,000.

• Certain unrecovered investment in a pension.

• Impairment-related work expenses of a disabled person.

[skidude]

Thank you. Regarding the third bullet:

• Federal estate tax on income in respect of a decedent.

A few questions:

1) My understanding that income in respect of a decedent (IRD), is income the decedent is expected to receive in the calendar year they pass, correct?

2) With an exception that if they are expected to receive an IRA distribution and pass before April 15th, and no IRA distribution is made, then there is no IRD, correct?

3) Social Security and surviving spouse company pension are also not considered IRD, correct?

[tagteam]

@skidude See https://www.irs.gov/publications/p559#en_US_2019_publink100099579

Also https://www.putnam.com/literature/pdf/II786-a62d61a8a9578c3bb3680f43e3e383f8.pdf

[mrANDmrsST1MUS]

My father passed away mid June of 2022 and I was called to be the executor of his modest estate to which I didn’t benefit from in anyway. At this tone. I was called from my home in middle Georgia to my hometown in south texas to handle the final arrangements and personal property along other things like his pets and the boats and supplies he used in his business as a fisherman. I left as soon as I got the call but he had passed away mid trip and by the time I arrived the whole property had been broken into  ran shacks and most of what’s was valuable was stolen or destroyed along with the house being left destroyed nearly on someone’s bad trip while on the search for buried treasure had punched hole in the walls and floors everywhere. It’s so sad someone could do that but it happens

i spent 25 days down there sorting trash from keep sakes and repairing the fanage in order to prepare for the sale. I kept a log of everything spent with receipts. I paid the clerk and filed appropriate paperwork prior to heading home after finding a suitable buyer. My father died intastate and my sister and we’re to spilt the proceeds although I passed my share on to her . I didn’t get reimbursement from the estate and am looking to claim these moneys spent on my taxes if possible . Is there a way to claim these as deductions paid to or for a private foundation as executor if his estate. Seeing. As I didn’t profit in anyway from the properties sale 

[tagteam]

No. Unfortunately, there is no mechanism available where you would be able to deduct those expenses from your individual income tax return.