Estate Planning - Taxes

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How to Deduct Interest and Taxes for a Decedent, Estate, or Trust

When preparing a decedent’s final income tax Form 1040, or an estate or trust’s Form 1041, you may deduct certain types of interest and taxes. Interest paid on mortgages and stock margin accounts may be [more…]

Farm Income, Ordinary Gains, and Other Income for a Decedent, Estate, or Trust

When filing Form 1040 or Form 1041, you need to determine if the taxpayer (whether trust, estate or decedent) has earned any farm income, and calculate any gains and losses on the sale of business assets [more…]

Calculate Income from Rents, Royalties, Partnerships, and Other Estates and Trusts

In order to file Form 1040 or Form 1041, you will need to determine if the taxpayer (whether trust, estate or decedent) has earned any incomes from rents, royalties, partnerships, or other estate or trusts [more…]

What Happens after Estate Form 706 Is Complete?

The IRS will issue Letter 627, Estate Tax Closing Letterif it accepts your estate tax return (Form 70) as filed, or if you and the IRS reach an agreement after a 706 audit. The closing letter, although [more…]

Tips for Preparing an Auditable Estate Form 706

Because only estates with a high asset threshold have to file Form 706, the IRS audits a higher percentage of these returns than any other type. Prepare the return and all its exhibits with this in mind [more…]

How to Complete Part 5 of Estate Form 706

Part 5 of Form 706 is used to summarize the gross estate by carrying forward the asset totals from individual Schedules A through I and the deductions from Schedules J through U. This summarizing process [more…]

How to Complete Lines 8–16 of Part 4: Estate Form 706

In Part 4 of Form 706, lines 8–16 are designed to remind you of other property that may be includible in the decedent’s estate and, consequently, is taxable. Be aware that if you aren’t including this [more…]

How to Complete Lines 4–7 of Part 4: Estate Form 706

Part 4 of tax Form 706 provides the IRS with information regarding the estate’s decedent. Lines 4 and 5of Part 4 identify the decedent’s surviving spouse, if any, and any entity that will benefit substantially [more…]

What Are Estate and Trust Gift and Generation-Skipping Taxes?

As the administrator or an estate or trust, be aware of the gift tax and the generation-skipping transfer tax. Large transfers made during lifetime, may be subject to the gift tax. To pay the gift tax, [more…]

What Are the Decedent’s Final State and Federal Income Taxes?

As the administrator of an estate, you must file the decedent’s final Form 1040, U.S. Individual Income Tax Return. Surviving spouses may file a final joint return for the year of the decedent’s death. [more…]

What Are Excise and Local Income Taxes for Estates and Trusts?

If the estate or trust that you are administering owns vehicles of transportation, such as planes, boats, and automobiles, you may have to pay a yearly [more…]

What Are Estate and Trust State Intangible and Real Estate Taxes?

Instead of income taxes, some states have intangible taxes on assets such as stocks and bonds. If you are administering an estate or trust, check to see whether your decedent’s state has intangibles taxes [more…]

What Are Estate and Trust Income Taxes?

If an estate or trust earns income, that income may be subject to income taxes. Follow the federal government criteria for determining whether your estate, simple trust, or complex trust earned enough [more…]

How to Locate a Decedent’s Assets through Tax Returns

For an estate executor in the process of locating a decedent’s assets, the decedent’s prior tax returns may be a useful resource. These tax returns (and the supporting documentation) provide information [more…]

How to Calculate Interest and Dividends for a Decedent, Estate, or Trust

When filing Form 1040 or Form 1041, your first task is to determine how much income the taxpayer (whether trust, estate or decedent) earned. Two of the main types of income you’ll have to deal with are [more…]

Where and How to File Estate Form 706

The administrator of an estate needs to know the basic rules for how and where to file Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return [more…]

How to Determine If an Estate Must File Form 706

Determining whether or not you need to file Form 706 for an estate depends on the size of the gross estate, or the total value of everything the decedent owned as of date of death, and the year in which [more…]

Seek Advice for Complex Schedules on Estate Form 706

Some of the schedules on the United States Estate (and Generation-Skipping Transfer) Tax Return (Form 706) involve complex areas of tax law. Schedules G, H, I, P, Q, R, and U are full of technicalities [more…]

How to Complete Schedule O for Estate Form 706

Use Schedule O to claim a charitable deduction when filing federal estate tax returns (Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return [more…]

Estate Tax Installments and Postponements: Part 3 of Form 706

An estate’s administrator can use Part 3 of Form 706 to make elections concerning the payment of federal estate taxes. When electing to pay the tax in installments, you need to verify that the estate qualifies [more…]

How to Obtain a Liability Release for Estate Form 706

Whether you file the decedent’s Form 706 as executor or trustee, you always want to obtain a release from personal liability under code section 2204. This ensures that you will not be liable for any additional [more…]

When Must You File Estate Form 706?

The executor, administrator, or personal representative of the decedent’s estate is responsible for filing Form 706 if the gross estate is larger than the applicable exclusion amount for the year in question [more…]

How to List and Value a Decedent’s Small Businesses

If a decedent owned a small business, in full or in part, the estate’s executor needs to value that small business and decide whether to continue the business or sell it. Use the decedent’s tax return [more…]

Write a New Property Sale Agreement for an Estate

If you are administering an estate in which the decedent was in the middle of a property transfer at the time of death, cancel the old purchase and sale agreement. Then write a new agreement in which the [more…]

What Is the Federal Estate Tax?

The federal estate tax applies to large estates. The year of the decedent’s death determines the qualifying value of the estate. If you are administering an estates that qualifies, you must complete Form [more…]


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