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Estate Can't Pay Estimated 1040 Tax

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  • 04-07-2009, 08:14 PM
    lc1960
    Estate Can't Pay Estimated 1040 Tax
    My question involves estate proceedings in the state of: IL

    The administrator filed out extension to file 1040 (Indiv income tax) for the decedent. Tax may be due. It would be advisable to pay estimated tax to avoid future fees, but currently the estate has no funds to pay the tax. It is not clear if these funds will ever materialize.

    Should the tax be A) paid directly from an account of a willing borrower (in exchange for note that the loan will be paid off if the estate gets the funds). B) pay the tax as described in A, but channell the funds through the estate account. C) not pay the tax until more money comes in and let the gov be one of the debtors.

    If no other money ever comes into the estate, the estate will be insolvent.
    If money comes in, will the person who loaned the money to the estate for the purpose of paying taxes will be considered class 3 or class 7 debtor?

    Thank you!
  • 04-09-2009, 05:40 PM
    Mr. Knowitall
    Re: Estate Can't Pay Estimated 1040 Tax
    Why would you put your own money into an estate that may not be able to pay you back?
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