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Filing an Income Tax Return for a Deceased Parent

Posted on Wednesday, August 23, 2023
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by AMAC, D.J. Wilson
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filing income tax for deceased parent

The big question

Many people understand that they are likely responsible for their spouses’ taxes upon the death of their loved one. As a primary example, where taxes were filed jointly, the surviving spouse in most cases files the tax return and is held liable for unpaid taxes. But what responsibility do people bear for filing an income tax return for a deceased parent?

Let’s explore

Filing and paying taxes on behalf of a parent who has died is generally the responsibility of the named person who was chosen to oversee the estate. Frequently, that appointed individual is an offspring of the deceased. Whoever is officially representing the deceased must report all income made by the deceased prior to their passing. Most often, the appropriate taxes can be filed using Form 1040 to report individual income. An income tax return must be prepared for the Estate if it generated more than $600 before being distributed to heirs. The Internal Revenue Service provides advice on how to handle taxes for decedents.

How does it work in the USA?

In the United States, debts and financial obligations do not automatically pass onto heirs. But should there be money in a parent’s estate, the IRS expects to be paid. If a person who dies carries tax debt, and leaves money in an estate to their offspring, the debt must be satisfied by the estate before distribution.

Are taxes like federal student loans: forgiven upon death of parent signer?

Many people mistakenly compare taxes to federal student loans. They are handled differently. Federal student loans are automatically forgiven upon a person’s death, whereas taxes are not. If an offspring acts as executor of a parent’s will, and fails to file taxes for that deceased parent, trouble can occur. They risk having the IRS place a federal tax lien against the estate. Simply put, tax liens are tools that the IRS uses to collect outstanding taxes. Liens generally occur after the government demands payment and tax debt remains unpaid. If a person inherits money and property from a parent, and there is money owed to the IRS, the debt to the IRS is generally paid by the executor before it reaches the beneficiaries.

Who can file a tax return for a deceased parent?

This generally falls under the responsibility of the executor or personal representative of the deceased. Note that the tax return is filed on a calendar year basis, although the deceased is responsible for the taxes accrued during the part of the year that they were alive.

Who can claim a refund for a deceased parent?

Only a court appointed representative or a surviving spouse can claim refunds for deceased taxpayers. This is done with Form 1310 filed with the return.

What should I do if I have trouble filing taxes for my deceased parent?

Taxes can be a complex matter. When in question, do seek the advice of a tax professional, such as a CPA, who has extensive expertise in taxes and in handling estate and decedent’s tax issues. For legal matters, seek out attorneys who specialize in wills and estates and estate administration. To avoid tax penalties and issues, it’s important to take the right steps when filing an income tax return for a deceased parent. Click here for more information on filing a tax return for a deceased person.

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