Have a Tax Question? Ask a Tax Expert
If you are filing estate income tax return fer calendar year - expenses should be deducted in the year paid.Thus if you filed separate 2014 and 2015 tax returns using form 1041 - you will deduct 2014 expenses on 2014 tax return and 2015 expenses on 2015 tax return.But if you are using a fiscal tax year - you will deduct expenses paid ding that fiscal year.
For fiscal year estates and trusts, file Form 1041 by the 15th day of the 4th month following the close of the tax year. For example, an estate that has a tax year that ends on June 30, 2016, must file Form 1041 by October 15, 2016. If the due date falls on a Saturday, Sunday, or legal holiday, file on the next business day.
For a decedent's estate, the moment of death determines the end of the decedent's tax year and the beginning of the estate's tax year. As executor or administrator, you choose the estate's tax period when you file its first income tax return. The estate's first tax year may be any period of 12 months or less that ends on the last day of a month. If you select the last day of any month other than December, you are adopting a fiscal tax year.
I appreciate if you take a moment to rate the answer.Experts are ONLY credited when answers are rated positively.If you still have any doubts, need clarification - please be sure to ask.I am here to help you with all tax related issues.