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Filing Responsibilty - Executor

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    Filing Responsibilty - Executor

    A question has been posed by a friend about a real situation. Taxpayer's mother died in Sep 2015. Then the taxpayer's father died in Jan 2016. Father was executor of mother's estate, and taxpayer is executor of father's estate. Parents were very secretive about their finances, but the only assets located so far consist of $1k in a checking account and $20K of equity in a home, which has been sold and the proceeds received & split by the taxpayer and a sibling.

    Taxpayer has found Social Security statements for father and mother for 2015, but nothing else. Taxpayer knows father had no other source of income, but is unsure about mother's income. Taxpayer's lawyer has advised that the taxpayer has an obligation to file father's return, but no obligation for mother's return.

    Taxpayer wants to simply file father's return as MFS by Oct 17 (an extension was filed) and do nothing about mother's return, since it is not known whether father filed anything for mother between Jan 1, 2016 and date of death in Feb 2016. Tax liabllity is very small on the MFS return for father. FIling his return satisfies the executor's obligation and begins the running of the SOL on the father's tax obligations. This would leave the question of the mother's filing obligations and/or tax liabilities unresolved, but according to the lawyer that isn't the taxpayer's concern.

    Anybody have any thoughts on the wisdom (or lack thereof) of doing things this way?
    "The only function of economic forecasting is to make astrology look respectful" - John Kenneth Galbraith

    #2
    In my (non-legal and off the top of my head) opinion, anyone without an appointed executor has one in the person who takes care of their affairs.

    I would assume that by dying in Feb 2016 that Father did not file mother's tax return so why not file a MFJ return for 2015? Did they file MFJ in previous years?

    Comment


      #3
      Yes, they filed MFJ in prior years. The executor only wants to accept responsibility for the father's filing obligation. It is unlikely that the father filed a return for mom, but they don't know for sure what he may or may not have done. The executor wants to only do what they are required to do. MFS accomplishes that.
      "The only function of economic forecasting is to make astrology look respectful" - John Kenneth Galbraith

      Comment


        #4
        OP states Father was executor of Mother's estate. Therefore, Father was responsible for filing either MFJ or (MFS for her as well as himself) for 2015. If current executor can locate 2014 returns, it may shed light on their sources of income. It is now his obligation to locate any assets or income for the decedents for the 2015 year. It is not likely a return will be required for 2016.
        Last edited by Burke; 10-16-2016, 03:54 PM.

        Comment


          #5
          I think the original question was posed to me because the executor doesn't want to go to the trouble to to look into prior years, and doesn't want to find out if mom had tax due for 2015. Filing dad as MFS seems to serve that purpose.
          "The only function of economic forecasting is to make astrology look respectful" - John Kenneth Galbraith

          Comment


            #6
            Accomplishes Nothing

            Originally posted by JohnH View Post
            I think the original question was posed to me because the executor doesn't want to go to the trouble to to look into prior years, and doesn't want to find out if mom had tax due for 2015. Filing dad as MFS seems to serve that purpose.
            John, I understand the executor doesn't want to go to extra trouble, but ignoring any possible reporting on the part of his mother accomplishes nothing. He doesn't escape any responsibility by MFS. I would inquire from 2014 from IRS to see whether there is anything of significance involved with his mother and whether a MFJ or MFS return was filed that year.

            This is a good example why elderly should make available to someone a record of their affairs. Bad tax planning on part of this couple. Not just bad tax planning, bad planning period.

            Comment


              #7
              I agree. Just glad I'm not preparing the return. I passed along the excellent recommendations from this thread and now it's up to the executor to do what they think is best.
              "The only function of economic forecasting is to make astrology look respectful" - John Kenneth Galbraith

              Comment


                #8
                I don't see how the father's executor can even prepare his fathers MFS return for 2015 without knowing about his mother's assets and income as well as the distribution of her assets. After all, her husband ... the father ... may have inherited them from his wife, or they may have been held jointly.

                Can it really be that difficult for the son to locate his parents' 2014 tax return? From what is revealed in the OP, it doesn't sound like the parent's had very much net worth. Surely the filing of a MFJ return would be best for the year 2015.

                Another issue: If someone's executor dies before the estate he is administering is settled and distributed, then someone must become a successor executor.
                Roland Slugg
                "I do what I can."

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