Since both 706 and 1041 is estate, what is difference between them?

Question

Since both 706 and 1041 is estate, what is difference between them? which one is i should use

Answer 1

A 706 is an Estate Tax Return that one files for the fair market value of all of your personal assets at date of death. While a 1041 is a tax return one files reporting the income earned during the year, from date of death to usually December 31st, and years thereafter, until the estate or "trust" is officially closed.

One would file a 706, only if, the fair market value of ones personal assets at date of death exceeds a threshold for reporting. Refer to irs.gov and search out Form 706
thresholds.

One files a 1041 to report to the IRS the earnings of an estate or trust created after one's death. If any income, or deduction, was reported on Form 706, it becomes income
and/or deduction in respect to a decedent, and therefore, either not taxable or deductible on Form 1041.

There are many different types of 1041'. The one you should use is dependent upon an
agreement or will that was set up prior to death or court ordered one after death.

You should consult a tax professional or CPA and discuss the matter.

Answer 2

The 706 taxes the value of all assets the decedent owned at death. The 1041 taxes the income of those assets while the estate administration is pending.

Answer 3

Form 706

Answer 4

who cares