When someone dies, their assets become the property of their estate. Assets such as savings accounts, CDs, stocks, bonds, mutual funds, and rental property may continue to generate income after their owner has passed. This income may require the filing of an estate income tax return (Form 1041) if there is:
- Any taxable income during the tax year, or
- Gross income of $600 or more, even if nontaxable, or
- A beneficiary who is a non-resident alien.
If Form 1041 is filed, Schedule K-1s should be generated to report this income to the heirs so they can report their share of this income on their own personal tax returns.
TurboTax Business handles Form 1041 and will also generate the K-1 schedules and figure out how much net income is allocated to the estate's heirs.
TurboTax Business is a Windows-only software program available in CD and download formats.