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I have a client that passed away. His attorney set up an estate.

There was an estate uncollected...
I have a client that passed away. His attorney set up an estate. There was an estate uncollected debt from a credit card for $12,606.00. I prepared his final 1040 return. Does he have to prepare an estate return for 2011. In addition for 2012 he received a cancellation of debt for his primary residence should a return be filed for this. If yes which return.
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6/3/2013
Megan C
Megan C, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 16,581
Experience: Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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MyVirtualCPA :

Thanks for asking your question! I'm sorry to hear about your tax issue and I'm going to try my best to help you understand or resolve it.

MyVirtualCPA :

Yes, you file an estate tax return in the year of the death

MyVirtualCPA :

Also, the cancellation of debt on the primary residence will be claimed on the estate tax return for 2012 since it happened post mortem.

MyVirtualCPA :

Is there anything else I can assist you with today? If not, please rate my response as "excellent" so that I may receive credit for assisting you today.

Customer:

What do I do with the cancellation of debt from the primary residence since it was issued one year after the date of death

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You would still file form 982 but it would go on form 1041 instead of 1040.

Please let me know if you need anything additional. If not, please rate as "excellent" so that I may receive credit for assisting you today.
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Customer reply replied 4 years ago

He passed in 2011 so there would be 2 estate tax returns?

You would file 1041 for the income of the estate. There would be two of those.

Thanks, XXXXX XXXXX me know if you need anything additional.
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Thanks for allowing me the opportunity to help you. Please let me know if I can be of any further assistance to you in this matter. I really enjoyed working with you – please feel free to request me again when you come back to ask another question. Simply enter "MyVirtualCPA" in the subject of your question Thanks again for being a JustAnswer customer
Megan C
Megan C, Certified Public Accountant (CPA)
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Megan C
Megan C
Megan C, Certified Public Accountant (CPA)
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