Wednesday, May 12, 2010

Important Post-Mortem Elections to Consider

During the administration of a decedent’s estate / trust there are several tax compliance issues and post-mortem elections that a personal representative and /or successor trustee should be aware of in the exercise of his/her fiduciary duties and to insure the efficient administration of the decedent’s affairs.

The personal representative of the estate will not only have to file a final individual income tax return but may also need to file an annual fiduciary income tax return until the estate/trust is fully administered. As has been mentioned previously on this blog, the final resolution of the estate tax for 2010 is uncertain; however, if no action is taken by Congress in 2010, come 2011 the estate tax not only returns in all of its splendor and glory, it will cast a broader net capable of catching any estate with a gross value of over $1,000,000.

There are several elections that can be made to defer the payment of estate tax in appropriate situations, to treat the estate and trust as one taxpayer, to elect to take deductions on an estate tax return or income tax return and so on.

There are also elections that a surviving spouse, intestate heir, or will or trust beneficiary may chose to make to preserve a homestead, provide for a family allowance, or disclaim an expected inheritance.

It is important that these options are discussed by the fiduciary of the estate with the beneficiaries. If you have been named as a fiduciary of a decedent’s estate or have priority to serve as an administrator of an intestate estate we would encourage you to contact our office to inquire about a free consultation.

-Attorney Robert Morris

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