Filing Status on the Final Return

If the decedent was married at the time of death and the surviving spouse does not remarry before the end of the year, the decedent's final return can be in the form of a joint return with the surviving spouse. The income reported is that of the decedent for the portion of the year he or she was alive, and that of the spouse for the entire calendar year. A full personal exemption can be claimed for the decedent even if his or her income was less than the minimum filing amount.

Filling a joint return usually results in significantly lower overall taxes, but this election must be agreed to by both the surviving spouse and the personal representative (if there is one who is not the surviving spouse). Otherwise, both the survivor and the decedent will have to file as "married filing separately."

If a personal representative was not appointed before the date the tax return is due, but is later appointed, he or she can file an amended return to change the deceased's filing status. If the status will be changed from "separate" to "joint," the surviving spouse must agree to the change. If the status will be changed from "joint" to "separate," the personal representative must file a separate return for the deceased within one year from the due date of the return; in that case, the original joint return would become the separate return of the surviving spouse.

The personal representative or other person filing the final return must sign it, and state his or her capacity (e.g., "Sharon Smith, executor for the estate of Sally Ann Smith"). If the final return is a joint return with the surviving spouse, the spouse must also sign it.