Fiduciary return

What it means

Two different returns are often needed after a death: a final personal return for the deceased, and a fiduciary return for income the estate earns afterwards — interest, dividends, rent.

The fiduciary return is filed by the personal representative or trustee, on behalf of the estate rather than the person.

Why it matters

It is easily missed, because families reasonably assume one final return covers everything.

It is also often unnecessary: small estates below the income threshold usually do not have to file at all.

When you are likely to meet it

• When an estate holds income-producing assets for any length of time.
• When an accountant asks whether the estate has its own tax identification number.

How this varies by state

States that levy their own income tax generally require an equivalent state return.

Related terms

• Employer identification number for an estateA tax identification number for the estate itself, which becomes its own taxpayer once the person's Social Security number stops being usable.
• Estate taxA tax on the value of what somebody left, paid by the estate before anything is distributed.
• Final income tax returnThe last income tax return in the person's own name, covering the part of the year they were alive.
• Income in respect of a decedentIncome the person had earned but not received when they died, taxed to whoever receives it.
• Inheritance taxA tax on what a person receives from an estate, charged to the recipient rather than to the estate — and only in a few states.
• Personal representativeThe neutral term for whoever is authorized to act for an estate, whether named in a will or appointed by a court.
• Required minimum distributionThe amount that has to be taken out of a retirement account each year once the rules require withdrawals to begin.
• Step-up in basisThe tax rule that resets an inherited asset's value to what it was worth on the date of death.

Official sources

The authority this page describes, at the agency that publishes it. Sahvelo does not restate a rule from a secondary source.

• IRS — information for a deceased person (opens in a new tab)

Sahvelo guidance that uses this

• Taxes after a death