796 / Are trusts and estates required to pay estimated tax?

Estates are required to file estimated tax for taxable years ending two years or more after the date of the decedent’s death.¹ Trusts are generally also required to pay estimated tax (see Q 648). However, there are two exceptions to this rule: (1) with respect to any taxable year ending before the date that is two years after the decedent’s death, trusts owned by the decedent (under the grantor trust rules) and to which the residue of the decedent’s estate will pass under his will need not file estimated tax (if no will is admitted to probate, this rule will apply to a trust which is primarily responsible for paying taxes, debts and administration expenses); and (2) charitable trusts (as defined in IRC Section 511) and private foundations are not required to file estimated tax.² A trustee may elect to treat any portion of a payment of estimated tax made by the trust for any taxable year as a payment made by a beneficiary of the trust. Any amount so treated is treated as paid or credited to the beneficiary on the last day of the taxable year.³

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1.  IRC § 6654(l).

2.  IRC § 6654(l).

3.  IRC § 643(g).