Form 1099 and fiscal year

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mgokman
mgokman Member Posts: 2 Newcomer

Forms 1099 (-INT, -DIV, -R, etc.) for your calendar tax year are normally generated by Jan 31st of the following year. If I use a fiscal year for estate income tax return, then some of the 1099s may apply to a previous year and others to a next year. For example, an estate fiscal year is Sept to Sept. The Estate takes IRA distributions from two accounts:

  • 1st account in Jul - before Sept, so should be included in the current year
  • 2nd account In Oct - after Sept, so should be included in the next year

forms 1099-R will be generated for each account in Dec. Since they don't reflect the actual dates of distribution, how will IRS know which one of them applies to what year?

Answers

  • MatthewD
    MatthewD FreeTaxUSA Team Posts: 247
    edited October 2023
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    Hi mgokman,

    Interesting question. Keep in mind that even through the estate is a fiscal year entity, you are not. All individuals are calendar year tax filers. As an individual, filing a Form 1040, you are required to report income in the year it was received. So regardless of how the estate reports the payments to recipients, you report it on the tax year for when you get the payment.

  • mgokman
    mgokman Member Posts: 2 Newcomer
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    Based on MatthewD's response, I see I need to make my question more clear.

    My question is about ONLY Estate Income tax reporting, i.e. Form 1041. I'm an Administrator of the Estate.

    There are several IRA accounts owned by the estate. I facilitate proper distributions from these accounts into the Estate owned bank account. I also take care of filing form 1041 for the estate using fiscal year.

    So the interested party here is the estate, I'm only trying to understand how to handle the documents.

  • CoryF
    CoryF FreeTaxUSA Agent Posts: 65
    edited October 2023
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    Thank you for clarifying your question, mgokman. FreeTaxUSA provides advice and service to individuals for tax return preparation. Meaning this question/answer is beyond our software abilities. We will leave this question feed open if other members of this community want to provide more advice. However, it may also be advised that you contact a local CPA or other tax provider that has experience in preparing the Form 1041 Tax return for Estates and Trusts.