Estate Return

[TAX]

Client's mother passed away in 2001. She owned real estate worth 1.5 million as of the date of death. One house in IL and One in WI. Mother has three children.

Nothing was distributed as of today - 2007.

No Estate return was ever filed.

(1) Was there any need to file estate return in 2001?

(2) Was Estate return required to be filed for all previous tax years - 2002-2006?

Thanks!

[BOB W]

Client's mother passed away in 2001. She owned real estate worth 1.5 million as of the date of death. One house in IL and One in WI. Mother has three children.

Nothing was distributed as of today - 2007.

No Estate return was ever filed.

(1) Was there any need to file estate return in 2001? ............... YES

(2) Was Estate return required to be filed for all previous tax years - 2002-2006? ................ YES

Thanks]

[TAX]

Client's mother passed away in 2001. She owned real estate worth 1.5 million as of the date of death. One house in IL and One in WI. Mother has three children.

Nothing was distributed as of today - 2007.

No Estate return was ever filed.

(1) Was there any need to file estate return in 2001? ............... YES

(2) Was Estate return required to be filed for all previous tax years - 2002-2006? ................ YES

Thanks]

Bob, thank you! Wouldn't her excusion amount help her and also nothing was distributed.
Could you please explain in little detail.

[BOB W]

This estate needs to be referred to an estate lawyer ASAP. Don't get too envolved other than protecting yourself with a letter advising them to seek legal advise ASAP. Failure to act could make you part of the problem. It doesn't matter what the exclusions are, the estate needs to be processed and filed. Penalties are going to happen for failure to file timely which could involve failure to Pay and a mix of others. Once it is in the Lawyers hands you can then try to figure the tax exposure. You must not delay getting legal assistance by getting answers as to taxes that may need to be paid. This client does not have a choice based on taxes owed.