Estate Account from Sale of Trusted Home

surcuyo
surcuyo Member Posts: 4 Newcomer
edited December 2024 in Income

Should the executor of a Trust pay the tax on the entire amount of proceeds from the home sale, ie: estate, or distribute the funds to beneficiaries for them to pay the tax on income? Or is the estate subject to both taxes?

Answers

  • MatthewD
    MatthewD FreeTaxUSA Team Posts: 341

    Hello,

    If the estate sales the house and the house sale is reported on the Estate Tax Return (Form 1041: U.S. Income Tax Return for Estates and Trusts). Then gains may be reported on the Form 1041 and the proceeds are distributed to the heirs. We do not support a form 1041, so I suggest you consult with your accountant who is preparing the Form 1040. You will get a Schedule K-1 Form 1041 to report any earnings.

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