Form 1041 Estates

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RMClark55
RMClark55 Member Posts: 3 Newcomer

I'm working on a Form 1041 for an Estate. The Estate has $350,000 in Cash that came from savings/checking accounts of the decedent. In addition the estate earned $32,000 Income in 2023 from Dividends, interest income and other sources so a 1041 is required.

The decedents Will left a cash Bequeath of $75,000 to a Church. Is the $75 K deductible as a charitable contribution on Form 1041?. I've received different answers on this question and it's confused me.

Thanks for any assistance.

Answers

  • MatthewD
    MatthewD FreeTaxUSA Team Posts: 247
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    Hello,

    Here is what I found in the Form 1041 Instructions about the Schedule A-Charitable Deduction. "Generally, any part of the gross income of an estate or trust (other than a simple trust) that, under the terms of the will or governing instrument, is paid (or treated as paid) during the tax year for a charitable purpose specified in section 170(c) is allowed as a deduction to the estate or trust."

    There are three requirements that must be met to qualify as a deduction.

    1. the donation must be from "gross income" of the estate.
    2. the donation must be authorized by the estate.
    3. the donation must be to a qualified charitable organization.

    Based on what you explained, $32,000 of the earnings would qualify for a charitable deduction. Here is a link to the instructions for the Charitable Deduction for Estates.

    https://www.irs.gov/instructions/i1041#en_US_2023_publink1000286183

  • RMClark55
    RMClark55 Member Posts: 3 Newcomer
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    Thank you. That is what I was hoping was the answer. The Will authorized the cash bequeath to a Church but didn't specify the source for the payment. I was wanting to "assume" that $32,000 of the payment was made from "gross income of the estate". That made sense to me but I couldn't find anything that specifically addressed my questions.