The Motley Fool Discussion Boards

Previous Page

Financial Planning / Tax Strategies

URL:  http://boards.fool.com/yes-oddly-the-first-ones-had-no-taxable-income-30482790.aspx

Subject:  Re: inheritance of house - sale Date:  1/13/2013  11:38 AM
Author:  irasmilo Number:  117362 of 121572

Yes. Oddly, the first ones had no taxable income and now the one for 2012 does. I plan on calling the CPA to find out why. Personally, I don't think he knows exactly what he is doing!

Just because taxable income is different doesn't mean that the CPA doesn't know what he is doing.

The simplest explanation maybe that the rent has increased. There may have been repairs or other non-reoccuring expenses that aren't depreciated.


That's not the simplest explanation. An Estate is not a pass-through entity. It only issues K-1s when there is a distribution of cash or property to the beneficiary and/or in the final year of the Estate.

If the executor elected not distribute anything to the beneficiary, any income would be taxed at the Estate level. In years when distributions occur, the income is distribtued to the beneficary to the extent that cash/property was received and taxed at the beneficiary level.

Ira
Copyright 1996-2014 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us