who pays the taxes
If an individual inherits an investment account, liquidates the account and has some gains, do the individuals inheriting the account report the gains personally or is that done on the final tax return for the estate?
If an individual inherits an investment account, liquidates the account and has some gains, do the individuals inheriting the account report the gains personally or is that done on the final tax return for the estate?
Permalink Submitted by Alan - IRA critic on Sat, 2014-07-05 22:14
If the sale is made after the individual has received the account from the estate or received it directly from the decedent, the individual with get the 1099 and will report the gain.
Permalink Submitted by Don Warnke on Sun, 2014-07-06 12:13
the sale of the bonds was made while the account was still in the decedents name?
Permalink Submitted by mk foss on Sun, 2014-07-06 22:03
Gains recognized after the death of the account owner should be reported on the fiduciary income tax return for the decedent’s estate or trust even if the account has not been changed to the name of the estate/trust. In the final year of an estate or trust, all gains are passed out and taxed to the beneficiaries. When assets are revalued to the values at the date of death, there often aren’t large gains for assets sold by the estate/trust. But the stock/bond market is hard to predict.