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Is an executor fee considered taxable income when you ...

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Is an executor fee considered...
Is an executor fee considered taxable income when you are also the beneficiary of the estate.
Submitted: 11 years ago.Category: Tax
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Answered in 11 minutes by:
3/6/2006
Tax Professional: RD, Certified Public Accountant (CPA) replied 11 years ago
RD
RD, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 8,784
Experience: CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..
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Executor fee is considered taxable income to a beneficiary of an estate too.

Whether it will be other income or business income depends on the following-
Fees for being an executor, administrator or personal representative of an estate, unless you are engaged in the trade or business of being a professional executor, administrator, or personal representative. Fees for a nonprofessional are reported as other income on Form 1040 unless (1) the estate requires extensive managerial activities on your part for a long period of time and the activities may rise to the level of a trade or business, or (2) the estate includes an active trade or business in which you actively participate and the fee is for the operation of that trade or business. Fees for a professional executor, administrator, or personal representative (one who is engaged in the trade or business) are reported on Schedule C.

Let me know if you have any question.
[email protected]

Please note: This advice is based on limited facts provided by you. Since it is impossible for me to identify and consider ALL the relevant facts, this advice is not intended or written to be used for the purpose of avoiding penalties, and cannot be used for that purpose.
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