Yardley CPA Posted April 8, 2019 Report Share Posted April 8, 2019 A Small estate has rental income through a Schedule E. Can the estate pay the tax on that income on the 1041 or must it be reported to the three beneficiaries via their K1? I have little experience with estates, I was under the impression it needed to be reported to the beneficiaries on their K1? No? If it can be paid by the estate, is it a selection made on the 1041 itself? Quote Link to comment Share on other sites More sharing options...
Abby Normal Posted April 8, 2019 Report Share Posted April 8, 2019 If there were zero distributions then the income stays in the estate. If income was partially distributed, part will pass out and part will stay in. It's just like a trust. 1 1 Quote Link to comment Share on other sites More sharing options...
Yardley CPA Posted April 8, 2019 Author Report Share Posted April 8, 2019 4 minutes ago, Abby Normal said: If there were zero distributions then the income stays in the estate. If income was partially distributed, part will pass out and part will stay in. It's just like a trust. Assuming the income stays in the estate, and the rental income for 2018 amounted to just over $500, does the estate pay the tax on that with the 2018 1041? Quote Link to comment Share on other sites More sharing options...
Abby Normal Posted April 8, 2019 Report Share Posted April 8, 2019 Should be zero federal tax after the 600 exemption. State may have tax. 1 1 Quote Link to comment Share on other sites More sharing options...
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