Can You File a Deceased Taxpayer Return Electronically?

Can You File a Deceased Taxpayer Return Electronically?

A lot can change from one tax season to the next. Realizing this, the IRS has put processes in place to help taxpayers account for those changes. One unexpected, and unfortunate, change happens when a taxpayer dies at some point during the year. Survivors are then left to try to figure out how to reconcile the person’s taxes for the year, in addition to dealing with their own taxes. Filing a final tax return should be part of closing the estate of a loved one.

Filing Taxes for Deceased Taxpayer

If you’re filing taxes on behalf of someone who died during the tax year, you’ll use the same process as he would have otherwise. That means gathering all of the tax statements for the person, including any W-2 or 1099 forms. You’ll either use a tax preparer or do things on your own, but you’ll use the standard forms for the taxpayer, which is normally a 1040.

The easiest way to file with the IRS is to use software and file electronically. When doing this, you’ll need to follow the directions provided when you note that the taxpayer is deceased. If you’re filing the forms yourself, you’ll need to write “Deceased” and the decedent’s name, as well as the date of death, across the top of the deceased tax return. If the deceased was a spouse and you’re filing jointly, you’ll write both yours and his name in the name field and input your address where directed.

Signing Tax Return for Decedent

One of the biggest issues with submitting a deceased tax return is that these forms require a signature. Obviously, you can’t get a signature from the taxpayer in this case, and the IRS understands that. If no personal representative has been appointed and you’re the spouse filing jointly, you can simply sign the return and write “filing as surviving spouse" in the signature area below yours.

In many cases, though, a personal representative is appointed to administer a person’s estate after death. This person may be a family member, close personal friend or paid estate manager, but whatever the case, this person should sign the return, as well. If you’re married filing jointly, you’ll sign the form in your slot, then have the personal representative sign the form in your spouse’s.

Tax Refunds for Deceased Taxpayers

If the decedent is owed a refund, things get a little more complicated. You may need IRS Form 1310, Statement of Person Claiming Refund Due a Deceased Taxpayer, which allows you to claim the refund on behalf of the taxpayer. If you’re doing this, you’re likely either a surviving spouse or personal representative. Personal representatives will need to attach a court document that states that you have been legally appointed, unless you’ve filed in previous years as the decedent’s representative.

If you’re the surviving spouse filing jointly, though, you won’t need to file IRS Form 1310 to get the refund. It will be issued to you in the same way it would have originally been issued to both of you. You’ll need to mail the form to the IRS Service Center designated on the form.

When to File Separately

If you’re filing taxes for a deceased spouse, you can file the joint return alone if no personal representative has been appointed. If a representative is in place, you can file jointly with the representative signing. However, if you remarried before the end of the tax year, you won’t be able to file jointly, which means you’ll have to file separately. In this case, you’ll be married filing separately.

Although the law allows you to file a joint return if your spouse died during the tax year, a personal representative can request to revoke that right. If you filed jointly without involving the representative, that person has up to one year from the due date of the original return. This will separate your return from the decedent’s and calculate her taxes without your taxes being intermingled.

Back Taxes on Deceased Taxpayers

In most cases, the decedent will be up to date on his taxes and you’ll only have to worry about this year’s taxes. But if the person was behind on filing, or owed taxes on previous filings, either the spouse or personal representative will need to deal with this. You’ll simply file a Form 1040 for each tax year, using the information on the person’s earnings. Chances are, this information isn’t readily available to you, even if you’re the spouse. In that case, you’ll need to contact the IRS and provide verification that you are authorized to gather this information. Once the IRS has verified you, you can get copies of past tax documents, as well as a transcript of reported earnings for the years where a return wasn’t filed.

Just as you may need to complete IRS Form 1310 to get a refund, you’ll need to mail payment to the IRS if back taxes are due. If they’ve been neglected for a while, there could be significant penalties and interest due, as well, so you’ll need to check with the IRS to determine how much you owe. You can also determine past due amounts by looking at any tax liens that have been put on the decedent’s property. A Taxpayer Assistance Center, likely located near you, can help you go through things and determine exactly what is necessary to resolve everything for the decedent.

Filing Taxes as an Estate

When someone dies, the funds go into an estate, which generally operates as its own tax entity. If that estate generates more than $600 per year in gross annual income – through earnings on stocks and bonds, for instance – the estate will need to file a tax return. This is accomplished through first applying for an employer identification number, then filing Form 1041, U.S. Income Tax Return for Estates and Trusts.

Filing taxes for deceased taxpayers as an estate means figuring the estate’s gross income at the end of each tax year. You’ll file the form at the same time as other taxes are due, but if you need more time, you can apply for an automatic five-month extension. Once funds are distributed, you can close out the estate and report distributions using Form 706.

No Tax Return Required

Whether or not you’ll file a deceased tax return, electronically or otherwise, relies heavily on how much income the person made during the tax year. This often applies if the taxpayer died early in the year, which means she may not have earned enough to qualify. You'll follow the same income minimums for a deceased taxpayer as you would for anyone else.

For the 2019 tax season, you’ll only need to file a tax return for someone if she earned more than the minimum. That minimum depends on her employment status, age and filing status. If she’s under the age of 65 and single, you’ll need to file a tax return on her behalf if she earned $12,000 or more. If she was self-employed, though, you’ll need to file a return if she made $400 or more. If you’re filing as a couple, you’ll need to file a return if your combined income was $24,000 or more if you’re both under the age of 65.