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Discussion Forum Index --> Advanced Tax Questions --> FORM 706 - DEDUCTION OF TAX PREP FEES

Discussion Forum Index --> Tax Questions --> FORM 706 - DEDUCTION OF TAX PREP FEES

Tdh555 (talk|edits) said:

3 December 2009
I researched but cannot find an "election"...under the impression I can deduct final 1040/1041 fees on the estate return (Form 706) if not deducted on those returns. True? Election statement required? Thanks....

Me and the Boss (talk|edits) said:

3 December 2009
The 1040 fees should be considered a debt of the decedent and as such should be deductible on the 706.

The 1041 fees should be deducted on the 1041.

Are you thinking of the election regarding where to deduct final medical expenses? That one exists but I am not aware of an election regarding tax prep fees.

Dennis (talk|edits) said:

3 December 2009
Unpaid accounting fees and such come under the general heading of deductions in respect. Subtraction in computing IRD and deductible without election on the 1041 if paid during administration. Basically all debts of the decedent retain their nature when paid by the estate. (And yes they get deducted twice...♫)

DaveFogel (talk|edits) said:

3 December 2009
Wouldn't this come under miscellaneous administration expenses (see Reg. 20.2053-3(d))?

Dennis (talk|edits) said:

3 December 2009
Final 1040 fee is administration. (necessary either to collect assets or settle debts) Election under Sec. 642(g). 1041 fees can be argued either way.

R2 (talk|edits) said:

4 December 2009
I don't see how the final 1040 prep fees could be DRD since this was not a debt of the decedent. Consequently, it would be necessary to make the § 642(g) election in order to deduct those fees on the Form 1041.

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