It’s an unpleasant but inevitable fact of life that we all need to prepare and file our final tax returns at some point in our lives. When you’re the executor of an estate, this task can be especially challenging and complex. But there are some things you can do to help make the process go more smoothly, and this guide will show you how to prepare and file estate tax returns so the deceased’s wishes are carried out with the minimum amount of hassle.
What are estate tax returns? Estate tax returns are a type of tax return that is required when there is property worth more than a certain amount. There are two types of estate tax returns, federal and state. Federal estate taxes are based on the value of property owned at the time of death, while state estate taxes vary by the location where the person died. Who needs to file an estate tax return? The executor, personal representative, trustee, or beneficiary must file an estate tax return if they are involved in the administration of a decedent’s estate and/or own property with the decedent.
An estate tax return is due within nine months of the date of death. If the date of death is not known, an estate tax return will be due after three years. In order for a return to be considered timely filed, a copy must have been sent at least two weeks before the due date (or any extension deadline). The information needed for an estate tax return is extensive. You will first need the date of death and the date of birth of the decedent. The decedent’s address, occupation, marital status, and spouse’s name are also needed. In addition to this, a list of all assets in which ownership was transferred to the decedent, and those that were bequeathed or given as gifts, is required. If there are any liabilities incurred by the decedent, their value must also be accounted for. In terms of income earned by the decedent before his or her death, a copy of their final individual income tax return needs to be provided. The final individual income tax returns include any other gains made in addition to the inheritance they received from their relative’s estate.
How can I get help with preparing my estate trust tax return preparation in Ashburn VA? If you’re an executor or a trustee of someone’s estate, there are a lot of tax-related tasks that need to be done. When it comes time for filing the final individual income tax return, or preparing all the other returns such as federal and state estate tax returns, fiduciary income tax returns, and court filings, it can be overwhelming. And if you don’t know what you’re doing, mistakes can happen easily. The best way to avoid this is by hiring a professional who has experience in this area – like a CPA or attorney who specializes in these things. Doing so will allow them to get your documents filed correctly and on time, which will make things easier for your loved ones after your death. Plus, they’ll be able to answer any questions that come up along the way.