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1099-LTC year after death final return

Forum|Forum|3 years ago
February 5, 2023
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Need options/ways to handle a post death 1099-LTC

•father died in Oct 2021, was in a LTC facility 2021 (expenses), LTC policy company never paid any 2021 benefits

•2021 was father’s final personal tax return

•LTC lawsuit (by estate) settlement paid out in late 2022 (year after death)...$30K

•received 2022 1099-LTC, box 1 $30K, Box 3 per diem, box 4 qual contract, with fathers SSN as TIN (not the post death trust account TIN)

How might I handle this?

Should the 2022 1099-LTC have been recorded to the post death trust account TIN?

Do I file an amended 2021 for fathers personal taxes (but it’s a 2022 1099-LTC)?

Do I File a 2022 personal tax return (after final 2021)?

Can I xfer the 1099-LTC from personal TIN to the estate's Trust TIN?

Best answer by Anonymous_

This is income in respect of a decedent (IRD).

See https://www.irs.gov/publications/p559#en_US_2022_publink100099579

Report the income on the return of the person or entity receiving it. If the estate receives it, report it on the 1041. If you receive (which is unlikely, but possible), report it on your 1040.

Do not amend your father's final (2021) return or file another return for the 2022 tax year for him.

A

Anonymous_Answer

Employee

This is income in respect of a decedent (IRD).

See https://www.irs.gov/publications/p559#en_US_2022_publink100099579

Report the income on the return of the person or entity receiving it. If the estate receives it, report it on the 1041. If you receive (which is unlikely, but possible), report it on your 1040.

Do not amend your father's final (2021) return or file another return for the 2022 tax year for him.

T

tgfirstAuthor

Since the payment is presented as 2021 per diem (paid in 2021) LTC payment (stated so in the letter with the 1099-LTC),

would the estate 2022 1041 reporting be able to list 2021 LTC expenses to offset the box 1 income?
And case 2, if reported on my 2022 1040, would I be able to offset with the 2021 LTC expenses?

A

Anonymous_

Employee

If they are reporting this as having been received in the 2022 tax year (on the tax reporting statement), then it would most likely be appropriate to deduct the expenses against the IRD. However, it would probably be best to report everything on a 1041 rather than a 1040.