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Estate Checklist


The following checklist covers many, but not necessarily all the important things that should be done when opening an estate. The list also includes reminders that can be helpful to your client. The most critical thing is not included, which is to meet with your CPA when you open the estate or trust file.

1. Obtain a Federal ID number for estate at beginning of administration.

2. Your CPA will need, at a minimum, the letters of administration, the inventory, the federal id #, the accounting, names, addresses and Social Security numbers of the beneficiaries

3. Transfer income producing assets to new accounts with the new estate Federal ID number ASAP

4. If you have non-taxable income producing assets in the estate, it can sometimes be advantageous to immediately sell or distribute those items and then cut the year off and start a new year without them.

5. IRD items are taxable to the recipient (income in respect of decedent).

6. Estates are taxed at the higher brackets than individuals

7. Even if an estate has no income, it is still often advantageous to file a 1041. Sale of a personal residence will generate a loss to the extent of closing costs, and fees can generate a loss, both of which can pass through to the beneficiary.

8. An estate can elect a fiscal year on a timely filed return.

9. A grantor trust can elect to be treated as an estate and elect a fiscal year.

10. If possible, wait to be paid toward the end of administration.

11 .There is a Sixty-Five day rule that can help you.

12. There are accountants, including CPAs, that will accept engagements in this area who do not practice in this area.