My best friend passed away in 2023

[Marthe48]

I was one of her beneficiaries, which touched me so much. The bulk of her estate was dispersed last year, but there was a bank account. The lawyer handling her estate hasn't dispersed it so far. According to my friend's sister, the lawyer explained that they have to wait on IRS to be sure no taxes are due for 2025. I don't understand why there would be taxes in the year after she passed away.

Can anyone explain why there might be taxes due for 2025?

Thank you.


I wrote the wrong year in the header. She passed away in 2023, not 2024.

[LoisB]

1. The only thing I can think of is if there was interest income earned on the bank

account.

[sinkingfeeling]

2. The only thing I know is I had to file taxes for my sister & BIL's trust for 5 years after their deaths.

[IbogaProject]

3. Estates are subject to a type of holding period

The executor can choose the total estate value as of either Day of Death or Nine Months later, one or the other for Estate Tax purposes. Nowadays with such high limits past ten million it seems silly. And States themselves have a holding period for all creditors to make claims on debts owed. But the people handing the estate may be streatching out the timing to bill a little more is another possibility.