Will My Estate Have To Pay Taxes?

Jeanine Answers: When a person dies, there are three tax returns that may have to be filed. The decedent’s representative must file the decedent’s final income tax return (Form 1040) by April 15th of the year following death. If the estate earns a certain amount of income before it is distributed to the beneficiaries, the representative may have to file an estate income tax return (Form 1041). Finally, if the value of the decedent’s estate is higher than the federal estate tax exemption ($5,000,000 in 2011) and/or the Illinois estate tax exemption ($2,000,000 in 2011), the representative will have to file estate tax returns.