Fiduciary Taxation

Fiduciary comes from the Latin word meaning “to hold in trust“. A fiduciary is a legal or ethical relationship of trust between two or more parties, typically involving the prudent care of assets by one party for another.

When faced with such a tremendous duty of care to another, it is good to know that there is someone who can assist with navigating the tax world to help you fulfill your duty while protecting the interests of those who have entrusted you with their affairs. With estate tax laws continually changing, it is more and more important that there is a thorough review – and often additional tax returns filed – in order to protect the interests and assets of the surviving spouse, family members, and other beneficiaries in the future. We will help you to understand not only the required tax filings, but those which may be advantageous to your unique situation.

Whether serving another in the capacity of personal representative or executor, trustee, conservator or simply as the surviving spouse or children of a decedent, you may find yourself responsible for the preparation and filing of various tax returns for the person or trust you serve. Our firm provides assistance with the preparation and/or review of these tax returns in addition to the more commonly-known personal income tax returns. We can assist with the sometimes daunting task of gathering necessary documentation for and the preparation of the cumbersome estate tax return, gift tax returns, annual fiduciary income tax returns for estate and trusts, and personal income tax returns.

At the Federal Level, Fiduciary Tax Returns Include:
  • Form 1041: Estate or Trust Income Tax Return
  • Form 706: Estate Tax Return (often called an inheritance tax return)
  • Form 709: Gift Tax Return
When to start & Where to begin

Whenever you have been appointed and have agreed to serve as a fiduciary, you should seek the assistance of a qualified tax professional to help you carry out and timely complete all of your tax filing obligations. As soon as you have been appointed and accepted your role as a fiduciary and begin the process of administering the estate or trust, you should call to schedule an appointment with us. If you are an individual who has made a taxable gift of property, ideally you would schedule your appointment prior to completing your gift to come up with an appropriate strategy, which could possibly avoid the need to file a gift tax return.

What to bring

To get the most out of your initial consultation, you should bring the following:

  • Documentation to Clearly Identify the Property That You Wish to Gift, if Applicable
    • Deed for Real Property
    • Stock Certificates if a Gift of Stock
  • Anything You Have Which Would Help to Establish the Value of the Property
  • List of All Assets Owned by the Estate or Trust Including Valuations
  • All Income and Expense Information Incurred During the Estate or Trust Administration Period
  • Tax-Related Documents Including W-2s, 1099s and Account Statements
  • Prior Tax Returns Filed
What to expect

We will take the time to sit down and explain to you when your returns are due, if they are required or merely advisable, and your legal obligations to properly discharge your duties as a fiduciary and taxpayer. We will handle preparing the return, and we can discuss with you who will be responsible for getting some or all of the information necessary to complete the preparation of all returns.

We don’t stop there

Generally, our Fiduciary Taxation services are provided in conjunction with helping a family member administer a trust or estate on behalf of a deceased loved one, or preparing a personal income tax return for an individual under a conservatorship or a durable power of attorney.