Dealing with the death of a loved one is one of the toughest things you’ll ever have to do. Managing their final affairs can become even more difficult than usual if you’re in charge of their estate, which forces you to figure out how to file back taxes for a deceased person.
Not sure where to start? Check out the five crucial steps you should take while serving as the personal representative for a loved one and filing their final tax return below.
Unfortunately, there are no exceptions for the deceased when filing their taxes. You’ll need to follow the same schedule as usual and file your final tax return by the filing deadline on or around April 15.
However, you also have the option to ask for an extension if you believe your other executor responsibilities will make it virtually impossible to file a deceased person’s taxes on time.
When filing taxes for a deceased person, you must have the necessary documents on hand. This may include:
Any income earned before death by your loved one is considered taxable. Be sure you don’t forget to include any key documents on a loved one’s tax return by gathering the right documents.
Making sense of how to file back taxes for a deceased person requires you to fill out the right tax return forms. If you’re filing taxes for the current year, Form 1040 is the form you should fill out. If you’re filing back taxes, you’ll need to secure Form 4506-T.
You’re also typically required to fill out Form 56 to let the IRS know you’re filing a deceased person’s taxes or back taxes on their behalf. You can avoid possible tax complications by including this form along with Form 1040 or Form 4506-T.
Technically, the IRS will have up to three years to let you know if you filed any aspect of a deceased person’s taxes improperly. This could cause issues down the line if the IRS notifies you about some income you missed while filing their taxes, long after you’ve determined a loved one’s probate and estate value and distributed their assets.
To prevent this, consider filling out Form 4810. This will serve as a request for the IRS to assess a deceased person’s tax returns within just 18 months. You can steer clear of having to scramble to pay unexpected tax bills in the future.
If you find yourself struggling to determine how to file back taxes for a deceased person at any point, don’t panic! Although you can’t ignore a loved one’s tax obligations, you can find help filing their taxes.
Search for a tax professional with experience filing taxes for those who are deceased. They will lend a hand with a loved one’s taxes.
A tax professional will also help you complete Form 1310 if you plan to receive a refund for your loved one or offer assistance with an estate tax return (Form 1041).
Figuring out how to file back taxes for a deceased person isn’t always easy. Levy & Associates is here to help. Give us a call at 313-447-1704 or complete this form to schedule a consultation.
Levy & Associates is available for free initial consultations. We’re happy to answer any questions you have about the audit process or address any concerns about your specific situation.
There’s never a good time to be audited, and the time-consuming process will take away from your business or family if you try to face it alone. Let us handle and coordinate communication, so you can return to your daily life.