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I WAS MADE PERSONAL REPRESENTATIVE OF AN ESTATE. THE

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ATTORNEY TOLD ME THE MONEY...
I WAS MADE PERSONAL REPRESENTATIVE OF AN ESTATE. THE ATTORNEY TOLD ME THE MONEY I WOULD RECEIVE WAS A GIFT AND NOT TAXABLE. THEN I GOT 1099 R FOR THE AMOUNTS THAT EVERYONE RECEIVED. HOW DO I FILE THIS, AND DO I HAVE TO PAY TAXES?
Submitted: 2 years ago.Category: Tax
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2/20/2016
Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago
Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 17,826
Experience: 15years with H & R Block. Divisional leader, Instructor
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Hello

The payment is not a gift unfortunately. The attorney must not have been a tax attorney.

The payment goes on line 21 of your 1040 but no Self Employment tax on this should apply. So if you use a software program mark SE TAX is not applicable.

The amount will be added to your income.

Please remember to rate my service excellent once you have all the information you need. If you have any other questions, please ask me – I’ll be happy to respond. Thank you!

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Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

Was this a distribution form a retirement account?

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Customer reply replied 2 years ago
are you telling me that an estate return does not need to be filed/
Customer reply replied 2 years ago
I thought I would need to file 1041
Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

No I am asking if your name was on the 1099R

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Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

Where you report this depends on who was issued the 1099R.

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Customer reply replied 2 years ago
the 1099 R was issued to the estate.
Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

Then the estate is the taxpayer and you would file the 1041 for the estate

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Customer reply replied 2 years ago
with my name under the estate name listed as the personal representative
Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

If the 1099R was in your name then you would be responsible to report on your return.

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Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

That is just who is responsible to receive the form.

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Customer reply replied 2 years ago
do you know where the income goes on the 1041?
Customer reply replied 2 years ago
can you share some insight on where the 1099 R income is reported on the 1041?
Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

Line 8—Other Income

Enter other items of income not included on lines 1, 2a, and 3 through 7. List the type and amount on an attached schedule if the estate or trust has more than one item.

Items to be reported on line 8 include:

  • Unpaid compensation received by the decedent's estate that is IRD, and

  • Any part of a total distribution shown on Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc., that is treated as ordinary income. For more information, see Form 4972, Tax on Lump-Sum Distributions, and its instructions.

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Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

We posted at same time so that delayed my answer

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Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

If this was all the estate received it should not be too difficult.

Please remember to rate my service excellent once you have all the information you need. If you have any other questions, please ask me – I’ll be happy to respond. Thank you!

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Customer reply replied 2 years ago
after I report the income, do I have to pay taxes since it is reported on 1041?
Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

The estate would if no tax was withheld.

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Customer reply replied 2 years ago
the estate does not have any money..there were no assets with the exception of the 1099 R income
Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

The money from the 1099R would be used. You would not distribute funds until tax was paid.

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Customer reply replied 2 years ago
The attorney distributed the funds, but told me they were not taxable. There is no money left.
Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

I would call the attorney and ask if he held any back for the tax (after you complete the tax calculation to see what is owed).

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Customer reply replied 2 years ago
I have already talked to the attorney, she said that she was sorry that she thought it was a gift. , that I would have to pay the taxes.
Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

The estate will owe the tax. You as personal representative are responsible for making sure the taxes of the estate are met.

If the estate does not pay the IRS can make those that received distributions pay.

Start by asking the people the money went to. Explain to them about the attorney and her bad advise.

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Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

I am sorry the attorney advised you wrongly and that the funds were distributed.

I sincerely ***** ***** could advise that there is no tax.

When you actively click on a rating and click submit, that lets Just Answer know you were assisted and credits me for the time.

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Tax Professional: Robin D., Senior Tax Advisor 4 replied 2 years ago

Checking back to see if you responded

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