The fiduciary of a trust or an estate is accountable for overseeing that all income taxes have been filed and paid each year. If you have been appointed as the trustee of a trust or administrator of an estate, there are specific tax returns you are responsible for filing. Unlike personal income tax returns, fiduciaries can file income tax returns on behalf of an estate or trust following a calendar year or a fiscal year.
Types of property that trusts can own:
- Stock portfolio
- Rental real estate
- Earnings and interests
- A deceased person’s assets
- Small business trusts
This income that a trust can receive, such as dividend and rental, must be reported with a 1041 form. This form is also used to make deductions on the taxable income received from the trusts and estates. Your role as a fiduciary is to ensure that the 1041 form is filed each year on behalf of the trust or estate you are liable for. These taxes are typically paid out of the trust or estate property.
At BatesCarter, our tax professionals will walk you through this process step by step. With over 50 years of tax preparation experience, trust us to keep your finances, and any estate that you may be the representative of, in order. Contact us today to schedule your one-on-one consultation.