Estate Income Tax Return

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  • #5205
    fbedy
    Participant

    After my parents passed (Aug 2018) we cashed out their mutual funds filed an (initial ) estate income tax return and payed the taxes owed from the estate and then divided up the money… Now in Jan 2020 we sold their house and after looking at the numbers we show a loss on the sale… My questions are…
    1. Do we have to file a second and final return since we had a loss on the sale?
    2. If we do have to file would we wait and file on 2020 return (since we sold it in Jan 2020 ) or could we file this tax year 2019?
    We used a calendar year on the first return… Thanks for your time and efforts…

    #6636
    Lewis-H
    Participant

    If the deceased person’s estate earned income after the date of their death — such as interest on a bank account or dividends from investments — you may need to file a second income tax return, Form 1041, for estates and trusts. Form 1041 is only required if the estate generates more than $600 in annual gross income.

    Accountant
    CloudDesktopOnline

    #6637
    fbedy
    Participant

    The second return would only be for the sale of the house which showed a loss… Not sure whether we need to file the second return? Thanks for your time and efforts…

    #6699
    kaneohe
    Participant

    don’t know the real answer to your question. If this were a personal return and you had calendar yr filing, this sale would be a 2020 data point. If this is the only income for 2020…a capital loss….I don’t think you’d get any tax benefits. Would an estate income tax return be any different?

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