back to the trust year

[WITAXLADY]

so I was informed my client that passed away July 2017 is to do a Fiscal Trust - so it is ends June 2018 - I do not need to do anything until Sept 2018? And then an extension if I am not for whatever reason not done with it?

Thx D

[SaraEA]

Most trusts have to use a calendar year.  Estates can use a fiscal year.  An estate 1041 ending June 30 2018 will be due Oct 15.  You can file for a five-month extension.

[DANRVAN]

There are two things to keep in mind. For the first year the estate can chose a short year for any number of months it choses.  Secondly,  the estate can adopt an accrual method of accounting.  Those are powerful tools in timing income, expenses, and distributions to beneficiaries!

 

[WITAXLADY]

thx - I understand the accrual portion - you can finish up without really receiving  - knowing it is coming..

Do I need to do anything paperwise or just when I file for an extension or just when I file ? if it closes June 2018 - 1 year - if I do not chose a short year - just 1 year - when is it first due without an extension..

 

and I realized after, I should not have said trust as this is an estate.. sorry.

[Burke]

You elect a fiscal year for an estate when the first return is filed.  So that means your deceased client's estate tax year ends June 30, 2018.  You can file the return anytime after that up to the 15th of the 4th month following, or October 15, 2018.  IF you want a further extension, you must do so prior to October 15.  Then you get MORE time to file.   Many people file for an extension using the calendar year; especially if they do not yet know whether to elect a fiscal year or not.  And that is okay too.  Filing an extension does NOT select a fiscal year, and you are not committed to a calendar year by doing so.  Only filing the return does that.