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    How early can initial 1041 be filed.

    I've only done one 1041. This will be my second.

    Client's mother passed 1/10/18. Extremely basic estate. All assets are or will be distributed by end of July (planned).

    The client is aware of 1041 need. Wants it done asap.

    Isn't it true that 2018 1041 doesn't come out until similar time for 1040? Thus client simply has to wait until the updated form is released?

    What about the 9-month requirement for filing. Meaning September? Am I to assume therefore that anyone who dies in the first quarter or so, has to file an extension?

    I know I'm missing some incredibly basic rules, procedures or logistics.
    Treasur2

    #2
    Why the rush?

    If DOD was 1/10/18, there will be some income attributable to 1040 and the rest (if any) after death to 1041.

    What were the sources of income for this taxpayer while she was alive?

    What is the rush to file form 1041 right now?
    Taxes after all are the dues that we pay for the privileges of membership in an organized society. - FDR

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      #3
      I am aware of all your points. My opinion is the client just wants it over from an administration standpoint.

      So ........question remains.
      Treasur2

      Comment


        #4
        Originally posted by Treasur2 View Post
        I am aware of all your points. My opinion is the client just wants it over from an administration standpoint.

        So ........question remains.
        Once IRS releases the 2018 Form 1041, I suppose you can paper file it. Efile will not begin until start of tax season for 2018 returns.

        I have never paper filed a 1041 form, so I am not aware of any special instructions.
        Taxes after all are the dues that we pay for the privileges of membership in an organized society. - FDR

        Comment


          #5
          Originally posted by Treasur2 View Post
          I've only done one 1041. This will be my second.
          Client's mother passed 1/10/18. Extremely basic estate. All assets are or will be distributed by end of July (planned).The client is aware of 1041 need. Wants it done asap.
          Isn't it true that 2018 1041 doesn't come out until similar time for 1040? Thus client simply has to wait until the updated form is released?What about the 9-month requirement for filing. Meaning September? Am I to assume therefore that anyone who dies in the first quarter or so, has to file an extension?I know I'm missing some incredibly basic rules, procedures or logistics.
          1. If everything is disbursed by July, it will be a short tax year, and the return is due on the 15th day of the 4th month following the end of the estate tax year. So that would be by November 15, 2018. You show the tax year at the top of page 1 of the form 1041 in the "beginning" and "ending" boxes. See instructions for 1041, page 8, under "When to File."

          2. Since you will use the 2017 form in your software, you should be able to efile it.

          3. There is no 9-month requirement for filing the 1041. You may be thinking about the Estate Tax Return, Form 706. Probably not applicable in this case, unless estate is in excess of $5.6 million.

          Comment


            #6
            Are there any issues with the 1041 that are effected by the Tax Cuts and Jobs Act that require preparing the return on a 2018 form rather than 2017?
            I suggest that you also consider the state filing which might require a 2018 calendar year return form.
            Uncle Sam, CPA, EA. ARA, NTPI Fellow

            Comment


              #7
              Originally posted by Treasur2 View Post
              I've only done one 1041. This will be my second.

              Client's mother passed 1/10/18. Extremely basic estate. All assets are or will be distributed by end of July (planned).

              The client is aware of 1041 need. Wants it done asap.

              Isn't it true that 2018 1041 doesn't come out until similar time for 1040? Thus client simply has to wait until the updated form is released?

              What about the 9-month requirement for filing. Meaning September? Am I to assume therefore that anyone who dies in the first quarter or so, has to file an extension?

              I know I'm missing some incredibly basic rules, procedures or logistics.
              The client doesn't tell the IRS what they want...the IRS tells the client what and when they can.
              Believe nothing you have not personally researched and verified.

              Comment


                #8
                Originally posted by Burke View Post
                1. If everything is disbursed by July, it will be a short tax year, and the return is due on the 15th day of the 4th month following the end of the estate tax year. So that would be by November 15, 2018. You show the tax year at the top of page 1 of the form 1041 in the "beginning" and "ending" boxes. See instructions for 1041, page 8, under "When to File."

                2. Since you will use the 2017 form in your software, you should be able to efile it.

                3. There is no 9-month requirement for filing the 1041. You may be thinking about the Estate Tax Return, Form 706. Probably not applicable in this case, unless estate is in excess of $5.6 million.
                #1 mother died in 2018..the filing date would be 04/15/19
                Believe nothing you have not personally researched and verified.

                Comment


                  #9
                  Not in this case. Perhaps my first response was not clear. See instructions for filing Form 1041 under PERIOD COVERED on page 8 under When to File. To wit, "The 2017 Form 1041 may also be used for a tax year beginning in 2018, if the estate has a tax year of less than 12 months that begins and ends in 2018 and the 2018 form 1041 isn't available by the time the estate is required to file its tax return. Also see instructions in this same paragraph regarding a short tax year and where that is indicated.
                  Last edited by Burke; 06-17-2018, 04:46 PM.

                  Comment


                    #10
                    Just wait for 2018 forms to be released!

                    OP says taxpayer wants to file ASAP for a decedent estate 1041 tax year ending in 2018. I can see other complications if 2017 forms are filed and there is a K-1 issued to beneficiary(s) etc. with 2017 forms.

                    If one of my client insisted on filing right now instead of waiting for the 2018 forms to be released and e-file ready I would ask them to seek another tax preparer. I am not ready to do manual workarounds and find myself redoing all that work if a complication arose because of early filing using the wrong year form.
                    Taxes after all are the dues that we pay for the privileges of membership in an organized society. - FDR

                    Comment


                      #11
                      This is not a manual workaround. It can be done quite legitimately in the software and IRS systems. The only drawback is, as you point out, that IF income is required to pass through to the beneficiaries on a K-1 (or final expenses as a deduction for that matter) the K-1 will show 2017 at the top of the form, which may be confusing. However, the same information about the short tax year and the beginning and ending dates that are on the 1041 will also show up in the same place on the K-1. AND the beneficiary has to remember that it goes with his 2018 individual tax return Form 1040 next year when he files. I always highlighted those dates with a neon yellow magic marker and included a cover letter which brings that to their attention. Most software has a stock cover letter for the K-1 anyway; you just need to adjust it as necessary. Unlike individuals, estates can have short tax years as well as fiscal years. If they are terminated by final distributions, it ends right then and there. They do not get to run to the end of the calendar year. Refusing to do the return seems a little drastic.....
                      Last edited by Burke; 06-25-2018, 05:33 PM.

                      Comment


                        #12
                        >> Refusing to do the return seems a little drastic.....

                        Perhaps but I don't like to make things more complicated for me at my age. I have refused engagements when I can sense complications down the road!
                        Taxes after all are the dues that we pay for the privileges of membership in an organized society. - FDR

                        Comment


                          #13
                          Originally posted by Burke View Post
                          Not in this case. Perhaps my first response was not clear. See instructions for filing Form 1041 under PERIOD COVERED on page 8 under When to File. To wit, "The 2017 Form 1041 may also be used for a tax year beginning in 2018, if the estate has a tax year of less than 12 months that begins and ends in 2018 and the 2018 form 1041 isn't available by the time the estate is required to file its tax return. Also see instructions in this same paragraph regarding a short tax year and where that is indicated.
                          Thank you. Thats the kind of to-the-point answer one appreciates.
                          Treasur2

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