1041 filing

[Edward Hebert]

Taxpayer dies 10/27/2021, Trust includes personal residence & tenant occupied rental house.  Beneficiary purchases personal residence on 02/24/2022 by refinancing property for the amount decided each remaining beneficiary should receive, which was less than the corrected amount.  Executor collected rents from the rental house for the entire year & paid taxes, insurance & other expenses, there was no mortgage.  Rental property was sold on 02/06/2023, should form 1041 be filed for both years because of the rental income activity?

Would appreciate any helpful advise.

 

Regards,

Edward G. Hebert

Professional Business Services
3741 Merced Drive, Suite F2
Riverside, CA 92503-4956
951-637-7000 Office
951-637-7003 Fax
ProB...@sbcglobal.net


____________________________________________

[Lee T Reams]

Ed,  in my way of thinking each beneficiary inherited their share of the property. Let’s say there were 4 beneficiaries and the FMV at date of death was $800,000. Each beneficiary’s basis would be $200,000.  Then the beneficiaries sold their share to your client for whatever cash they received from the refi.  Your client basis is $250,000 plus the amount he paid to the other 3 beneficiaries. As far as the rental goes who got the income?

Lee Reams, EA

818-338-8700 x240

On May 20, 2024, at 5:36 PM, Edward Hebert <prob...@sbcglobal.net> wrote:



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