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Different expert here, please accept my condolences on your father's passing.
You do not use an EIN on your father's final 1040 form. You are correct in your understanding. The final personal return of the deceased still uses the SSN. To ensure all income the deceased earned is accounted for, a legal entity called an estate is automatically created at the time of death. Report on the estate return -, Form 1041 -, any income received after the date of death. This includes income earned from bank accounts or stock while the estate is in probate. The estate must request its own employer identification number (EIN) to use for filing purposes. The EIN is not for the personal return. If your father would have been required to file a return for the year in which he died, , you must file a return on his behalf. Report income earned from the beginning of the year to the date of death on his final return using his SSN.
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Any amounts earned after the date of death (if not transfered to heirs) woul dneed to be shown on the 1041. You see his only income personally would be up to the date of death, after that, either the individuals that inherited the ittems or his estate would need to assume the responsibility of the income.
Many assets listing a beneficiary - like a life insurance policy or a brokerage account - can bypass probate and be paid directly to the beneficiary. Although the money paid out from assets that bypasses probate is usually not taxable, interest earned on these assets after the death of your family member is taxable. Since the asset is paid directly to beneficiaries, interest is considered income in respect of a decedent (IRD) if both of these apply:
If you are required to file a 1041 (the estate had income of more than $600 or there is a NonResident Alien beneficiary) you would use the EIN only on the 1041 form and not your father's 1040.
The IRS didn't tell us to get an EIN...it was the lady at the County Office for Probate. If all of the savings bonds and CDs were already accumulating interest, it doesn't seem like it is "new income." We have cashed them all and put them in a new bank account so we can divide them equally to the heirs. If we disperse all funds per the Will to all 6 heirs before there is $600 earned, wouldn't the Will be the governing paperwork and allow us to just file a 1040 at the end of the year? The 2 life insurance policies, the 12 CDs, closing the checking accounts, selling the 2 vehicles and household property (no real estate) only totaled $273,000 thus not requiring a Federal form 706 to be filed. There is a $20,000 CD with 1 of the heir's name on it maturing in October that will be able to pay any outstanding debts...we don't think there will be any debt.