Estates

An Estate is established upon your death. The death of a person can require the preparation of two separate tax returns for a single year. This happens because the tax year of the decedent ends with the date of death and the estate begins a new year starting the first day after the date of death.  Earnings of the estate must be reported on a separate tax return  until the estate is settled. The choice of the date of the fiscal year end of the estate is left up to the estate administrator ("executor" or "personal representative").   AGM Financial Services, LLC provides tax planning and tax preparation services ( Form 1041) to executors and administrators. We have affoiliated with attorneys who can handle the legal aspects of probate and estate administration.

Additionally, estate (or "death") taxes and estate tax filing may be required upon your death. The Estate Tax is basically a tax on your right to transfer property at your death. Currently, most simple estates that typically consist of cash, stocks and easy to value assets which have a total value of less than $5,000,000  do not require the filing of an estate tax return. For estates valued over $5 million ($10 million for married couples), there is no requirement to file an estate tax return. 

At your death, the gross estate value minus qualified deductions, will determine whether an estate filing and tax payment is required. There are many different variables which can determine the value of your estate, which not only include the value of all property at you death, but can also include:

  • The value of property you sold or transferred within 3 years of your death.

  • Insurance proceeds or annuities payable to your estate or heirs.

  • Trusts that your previously established.

Additionally, qualified deductions to the value of your estate may include:

  • Funeral expenses

  • Marital deductions

  • Debts owed at the time of your death

  • Charitable deductions

  • Administration expenses of your estate.

Trusts

The term "trust" is used by the IRS as a declaration whereby a trustee, or trustees, take title to the property of another to protect or conserve it for the beneficiaries. Trust administration includes filing  taxes, distribution of assets to beneficiaries and more.  Trusts that cannot be rescinded (irrevocable) must file tax returns each year.  Revocable trusts ("living trusts") do not file returns annually but take effective at the death of the trustee grantor.

Form 1041 - U.S. Income Tax Preparation for Estates and Trusts 

For estates and trusts, a Federal Form 1041 filing is required by the IRS. AGM Financial Services, LLC  is experienced with the proper preparation and filing of these returns which can be classified as an initial return, final return, amended return or change in fiduciary on the Federal IRS 1041 form depending on the situation.