Even your most financially savvy people aren’t going to think clearly after the death of their spouse. Taxes will be last on their minds.

However, there are important key points to consider, such as:

• Filing Status Changes: The surviving spouse can still file as Married Filing Jointly for the year of the spouse’s death, which can affect deductions and income calculations.
• Important Forms: Filing Form 4810 for a prompt IRS assessment can be beneficial. Ensure the final return is properly filed with the necessary signatures and annotations.
• Tax Implications: Evaluate whether Married Filing Jointly is beneficial, considering combined AGI impacts on deductions. Plan for future filing status changes that might place the survivor in a higher tax bracket.
• Document Preparation: Gather previous tax returns and financial documents. Use IRS Form 4506-T if necessary to obtain required records.
• Estate Planning: Update wills, beneficiary designations, and address potential identity theft by notifying credit bureaus.
• Financial Planning: Plan for reduced income streams, manage inherited assets, and consider tax strategies for capital gains and losses.
• Understanding these steps can help you navigate the financial and tax complexities during this challenging time.

Luba Milgrim

Luba Milgram is president and co-founder of Starlite Tax Solutions Inc. in Thousand Oaks. She specializes in tax planning for small-business owners that provide a huge return on investment. As a certified tax planner, she offers concierge tax and accounting services to assist clients with anything from income shifting strategies to managing a family business. Learn more about Starlite Tax Solutions at https://www.starlitetax.com or send a message via https://www.starlitetax.com/contact.