Taxation of an estate checking account?

[WhatInThe]

Question on how an estate checking account is taxed. Are the taxes determined by the distribution of the remaining balance or the checks written? Many estate accounts are set up to handle and/or do bookeeping for estate related expenses but what about checks for misc? Does ANY money going into the account gets taxed? Need to wire transfer money to handle a misc estate transaction. Is there a dollar amount that would trigger a tax.

 

[Marie5656]

Good question. All I know is I have not gotten any taxes taken out of Rick's estate account. And no info for the IRS. But, his account contains less than $500, so I do not know if that is relevant. Can you ask the bank? Or tax accountant. I would be interested in knowing what you find out.

 

[mathjak107]

i am not following the question ... is this a trust or an account from an estate being closed out ?

 

[Aunt Bea]

Same here.

The activity in an estate checking account, by itself, would not trigger a tax.

The source of the money might trigger a tax if it represented income to the estate or the payment might trigger a tax if it represented earned income to the recipient.