Nothing may be certain but death and taxes, but the tax man is immortal. You’ll need to report your spouse’s income on final federal and state tax returns (they can be joint returns) for the year of death. The estate may have to file returns, too, if it receives much income before it’s settled.
If your spouse passes away, estates with a gross value exceeding the federal estate tax exclusion — $5.45 million in 2016 — must file an estate tax return even if no taxes are owed after deductions. You may want to file a federal return for smaller estates, though. Only by doing so can you add your spouse’s $5.45 million exclusion to your own, allowing you to pass on more than $10 million estate-tax-free. If there’s any chance you might accumulate more than $5.45 million in assets (by winning the lottery, maybe), you’ll want to preserve this option. A few states require state estate tax returns, too.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
-
Stock Market Today: Stocks Gain on Tech, Auto Tariff TalkThe Trump administration said late Friday that it will temporarily halt tariffs on some Chinese tech imports.
-
Sam's Club Plans Aggressive Expansion: Discover Its New LocationsSam's Club expansion plans will open up to 15 new stores each year. Learn where they plan to open in 2025.
-
Tax Time: Does Your Kid Influencer Owe Taxes?State Tax Some minors are making big money on social media. Here’s how to know if they need to file taxes.
-
Free IRS Tax Filing for 30 Million People: Will It Continue Under Trump?Tax Filing Direct File was piloted last year in 12 states and has since expanded to 25. But some wonder whether the program will last under the Trump administration.
-
How Caregivers for Adults Can Save on Taxes in 2025Tax Breaks Caring for your parent or spouse can be stressful, but the IRS offers tax breaks for qualifying taxpayers. Here they are.
-
U.S. Treasury to Eliminate Paper Checks: What It Means for Tax Refunds, Social SecurityTreasury President Trump signed an executive order forcing the federal government to phase out paper check disbursements by the fall.
-
IRS Layoffs Spark Delays, Doubt This Tax Season
Tax Season Tax experts say Trump’s downsizing of the IRS is already causing problems.
-
States with the Highest Income Tax Rates for RetireesState Tax You may reconsider living and retiring in one of these states due to high taxes.
-
AI Tax Scams Target Middle and Older Adults: What to KnowScams Whether you’re a retiree or Gen Z, scammers can gouge big financial losses with the help of artificial intelligence.
-
Tax-Deductible Home Improvements for Retirement in 2025Retirement Taxes Your aging-in-place plan could benefit from the medical expense tax deduction. But watch out for capital gains and property taxes.
