Do You Have to File Taxes for Someone Who Has Died?0 USER TIPS ADD YOUR TIP
Unfortunately, death does not relieve us of our tax obligations. That means that if your loved one died in the current tax year, you or the executor probably still has to file an income tax return on the deceased’s behalf.
Filing a final income tax return for the deceased
The same filing requirements apply to a deceased person that apply to any other taxpayer. According to the Internal Revenue Service, if a deceased person earned wages or had any other income before dying during the current tax year, his or her estate must file a standard tax return, which will be a final income tax return. And the same deadline applies as if your loved one was still living: The tax return must be filed by the April after the year in which the person died (meaning an April 17, 2018 deadline for anyone that died in 2017). You’ll also have to file a state tax return.
Even if your loved one didn’t have any income, you may still want to file to get any tax refund that could potentially be owed to the estate.
Who files taxes for the deceased
If there’s an executor of the estate (either named in the will or appointed by the court during the legal process known as probate), they are responsible for filing taxes for the deceased. But if there’s no executor, the surviving spouse typically files, or another family member can complete the task. If the deceased taxpayer was married, the surviving spouse still has the option of filing jointly for the last tax year that the deceased was alive.
How to file taxes for the deceased
Filing a tax return for someone else can be exceptionally tricky, so calling in an accountant or professional tax preparer is recommended. You’ll likely be asked to gather the last three to five years of the decedent’s tax returns, to ensure that there isn’t any overlooked income or uncollected taxes that need to be accounted for in the final income tax return.
Like any other taxpayer, you’ll need to file (on the decedent’s behalf) a 1040 form, or 1040A or 1040EZ depending on their status. You’ll also need their W-2s (for tax-withheld income) and 1099s (for untaxed income). These forms are typically mailed from an employer or hiring agency to an individual’s mailing address on file. If you don’t have access to the decedent’s mailbox or can’t locate the forms, contact any employers and request copies be mailed to you. (You may have to show a death certificate and proof of relationship to gain access to these forms.)
If the deceased earned income from investments or inheritances after they passed away, you’ll also need to fill out a 1041 form, which lists income from any retirement accounts, mutual funds, life insurance policies, investments, or other assets that are counted towards the decedent’s estate.
How to notify the IRS of a death
At the top of the completed tax return, you simply write the word “deceased,” along with the person’s name and date of death. You then sign your name in the taxypayer’s signature area, to signify to the IRS that you’re the representative of the estate. If it’s a joint tax return, spouses should sign their name and indicate that they are filing as a surviving spouse. (Filing electronically? Identify the person as deceased and note the date of death in your tax software.)
If the decedent is owed a tax refund, you can claim it using a Form 1310, which is a Statement of a Person Claiming a Refund Due to a Deceased Taxpayer. If a spouse is filing jointly, they don’t need to fill out this form. If the decedent is owed a refund, though, know that the executor is required to use that money to settle any outstanding debts or liabilities the estate has before distributing it to beneficiaries.
Filing taxes before distributing the estate
It’s a good idea to wait to distribute the estate until after taxes have been filed. Executors are required to settle all debts before distributing property and assets to heirs—including any taxes owed to the government. If the executor distributes all assets and then files taxes and finds the decedent owed money to the IRS, he or she could be personally liable for that amount owed.