Notifying the IRS of a death and filing the right tax returns is one of the most important — and most misunderstood — executor responsibilities. Here's what you need to file and when.
Notifying the IRS
The IRS does not require a formal notification of death, but you'll effectively notify them when you file the deceased's final return. Write "DECEASED" across the top of the return along with the date of death. If the deceased had a spouse who will file jointly, they use the surviving spouse's information.
The Final Individual Tax Return (Form 1040)
You must file a federal income tax return (Form 1040) for the year of death, covering income earned from January 1 through the date of death. The deadline is the same as for regular returns (April 15 of the following year, with extension available). File as "surviving spouse" or "executor" as appropriate.
Estate Income Tax Return (Form 1041)
If the estate earns income during administration — from investments, rental property, a business, or the sale of assets — you must file an estate income tax return (Form 1041). This is a common surprise for executors.
Federal Estate Tax (Form 706)
Federal estate tax applies only to estates exceeding $13.61 million (2024). If the estate is below this threshold, no estate tax return is required. However, some states have their own, lower estate tax thresholds — check your state's rules.
Getting Professional Help
Estate tax filings are complex. If the estate involves a business, significant real estate, or is close to the estate tax threshold, hire a CPA or estate attorney with tax expertise. Executor errors in tax filings can result in personal liability.
