Home Page link  

Form 1041, Sch D

  
Groups | Search | About
User Password
Register Now! Lost Password?

Taxes General Forum - Tax professionals meeting place and answers to queries. (Moderated)

 Post an article  get this group's latest topics as an RSS feed add this group's latest topics to your My MSN content add this group's latest topics to your My Yahoo content  add this group's latest topics to your Google content  YahooMyWeb Yahoo!  Google Google  Windows Live Favorites Windows Live  del.icio.us del.icio.us  digg digg  Add to Netscape Netscape
Subject Author Date
Form 1041, Sch D Fred J. Tydeman 02-29-2008
| `--> Re: Form 1041, Sch D removeps-groups...02-29-2008
---> Re: Form 1041, Sch D removeps-groups...02-29-2008
Posted by Fred J. Tydeman on February 29, 2008, 12:53 pm
Please log in for more thread options
 A few years ago, my mom bought some stock for $100K. A couple of
years later, she died and the stock was worth $70K. 9 months later,
the stock was sold for $80K (to help pay the Form 706 estate taxes).
Now, when I fill out the estate income tax return, Form 1041, Sch D,
do I show a loss of $20K ($80K-100K), or a gain of $10K ($80K-70K)?

My reading of the 1041 instructions says it must be a gain as the
basis is the value at time of death.

If I am required to show a gain, what happened to the ($70K-100K)
loss? Is it just gone when she died? If so, that means one should
sell their losers every year and try to use those losses on a 1040.
---
Fred J. Tydeman Tydeman Consulting
tydeman@tybor.com Testing, numerics, programming
+1 (775) 358-9748 Vice-chair of J11 (ANSI "C")
Sample C99+FPCE tests: http://www.tybor.com
Savers sleep well, investors eat well, spenders work forever.

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by ed on February 29, 2008, 3:53 pm
Please log in for more thread options
> A few years ago, my mom bought some stock for $100K.  A couple of
> years later, she died and the stock was worth $70K.  9 months later,
> the stock was sold for $80K (to help pay the Form 706 estate taxes).
> Now, when I fill out the estate income tax return, Form 1041, Sch D,
> do I show a loss of $20K ($80K-100K), or a gain of $10K ($80K-70K)?
>
> My reading of the 1041 instructions says it must be a gain as the
> basis is the value at time of death.
>
> If I am required to show a gain, what happened to the ($70K-100K)
> loss?  Is it just gone when she died?  If so, that means one should
> sell their losers every year and try to use those losses on a 1040.
> ---
> Fred J. Tydeman        Tydeman Consulting
> tyde...@tybor.com      Testing, numerics, programming
> +1 (775) 358-9748      Vice-chair of J11 (ANSI "C")
> Sample C99+FPCE tests:http://www.tybor.com
> Savers sleep well, investors eat well, spenders work forever.
>
> --
> << ------------------------------------------------------- >>
> << The foregoing was not intended or written to be used,   >>
> << nor can it used, for the purpose of avoiding penalties  >>
> << that may be imposed upon the taxpayer.                  >>
> <<                                

                        >>
> <<   The Charter and the Guidelines for submitting posts   >>
> <<  to this newsgroup as well as our anti-spamming policy  >>
> <<                  are atwww.asktax.org.                 >>
> <<         Copyright (2007) - All rights reserved.         >>
> << ------------------------------------------------------- >>
You are correct. You have a $10,000 long term loss. Yes the $30,000
is lost and
gone forever.

ed

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by removeps-groups@yahoo.com on February 29, 2008, 4:56 pm
Please log in for more thread options

> You are correct. You have a $10,000 long term loss. Yes the $30,000
> is lost and
> gone forever.

Were did a 10k loss come from? It's either 10k gain or 30k loss. Am
I missing something?

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by removeps-groups@yahoo.com on February 29, 2008, 4:55 pm
Please log in for more thread options

> A few years ago, my mom bought some stock for $100K. A couple of
> years later, she died and the stock was worth $70K. 9 months later,
> the stock was sold for $80K (to help pay the Form 706 estate taxes).
> Now, when I fill out the estate income tax return, Form 1041, Sch D,
> do I show a loss of $20K ($80K-100K), or a gain of $10K ($80K-70K)?

A gain of 10k. Strange, a lot of web sites tax about step-up of
basis, but few talk about a step-down. What's more: any wash sale
carryovers are also lost.

http://www.wwwebtax.com/deductions_z_other/capital_losses.htm

<Quote>

Death of the taxpayer

If the taxpayer dies and capital loss carry overs are not used up the
taxpayer's estate may not deduct the remaining capital loss. An unused
individual capital loss may not be carried over by a surviving spouse.

</Quote>

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by joetaxpayer on February 29, 2008, 5:17 pm
Please log in for more thread options


removeps-groups@yahoo.com wrote:

>
>
>>A few years ago, my mom bought some stock for $100K. A couple of
>>years later, she died and the stock was worth $70K. 9 months later,
>>the stock was sold for $80K (to help pay the Form 706 estate taxes).
>>Now, when I fill out the estate income tax return, Form 1041, Sch D,
>>do I show a loss of $20K ($80K-100K), or a gain of $10K ($80K-70K)?
>
>
> A gain of 10k. Strange, a lot of web sites tax about step-up of
> basis, but few talk about a step-down. What's more: any wash sale
> carryovers are also lost.
>
> http://www.wwwebtax.com/deductions_z_other/capital_losses.htm
>
> <Quote>
>
> Death of the taxpayer
>
> If the taxpayer dies and capital loss carry overs are not used up the
> taxpayer's estate may not deduct the remaining capital loss. An unused
> individual capital loss may not be carried over by a surviving spouse.
>
> </Quote>

When Mom died, her cost was not the issue. Step up in basis takes care
of that. So, she passed and the stock was worth $70K. Ok, but is there
not an alternate valuation of 6 months later? Since it was sold 9 months
later, this may or may not help, but odds are, the later valuation would
be higher, and the cap gain less than the $10K we are discussing.
JOE

www.blog.joetaxpayer.com

--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Similar ThreadsPosted
form 1041 March 5, 2008, 6:55 pm
Form 1041 March 30, 2008, 7:11 pm
file form 1041? January 19, 2007, 1:01 am
IRS follies: form 56 fiduciary vs. form 8822 change of address April 21, 2008, 9:54 pm
1041-X? March 3, 2008, 7:29 pm
Re: 1041 for estate in litigation October 24, 2006, 7:27 am
Re: 1041 for estate in litigation October 25, 2006, 6:46 pm
1041 - Tax Return for An Estate February 27, 2007, 10:11 pm
Simple Trust 1041 March 7, 2008, 2:09 pm
1041 deductible expense March 21, 2008, 9:01 am

Contact Us | Privacy Policy
This site is not affiliated with Intuit - makers of Quickbooks and Quicken software
This site is not affiliated with Sage Software - makers of Peachtree accounting software
XML SitemapXML Sitemap