Form 1310 and a Deceased Person's Final Return: 2026 Rules

Do you need Form 1310? Ten fact patterns

Search results for “form 1310” mostly tell you to attach it to “the final return”. The form says something narrower. Its Who Must File section keys on one question, who is asking for the refund, and not on the fact that someone died. The table follows the form and Publication 559; rows marked “our reading” apply their text to a case they do not name.

Two practical points sit under the table. The form says it “can be filed electronically when it is attached to a Form 1040, 1040-SR, 1040-NR, or 1040-SS being filed electronically”, so the common belief that it is paper-only is out of date on the IRS text. And on the IRS page for the form, “Recent developments” read “None at this time” when it was last reviewed on March 31, 2026; the revision on the IRS site is dated December 2025.

The final return: who files it, who signs, and when

The statute puts the duty on one person: the return of a deceased individual “shall be made by his executor, administrator, or other person charged with the property of such decedent” (26 U.S.C. 6012(b)(1)). Publication 559 turns that into signing rules and a date.

After the final return, the decedent’s number is retired for income tax. Publication 559 says not to use it “to file an individual income tax return after the decedent's final tax return” or for estimated tax for later years; the estate gets its own EIN, covered in our EIN for a trust or estate guide. Income received after death belongs on the estate’s Form 1041 (see our estate and trust brackets page).

What lands on the final return, what is IRD, what steps up

This is where investors with rentals and fund interests need the page. The line between the decedent’s final return and everyone else’s returns is the line between income already earned and income earned later or received later. Publication 559 defines the leftover bucket: “All income the decedent would have received had death not occurred that wasn't properly includible on the final return, discussed earlier, is income in respect of a decedent.” The recipient, not the decedent, reports it, in the character it would have had for the decedent (26 U.S.C. 691(a)(3)).

The table sorts 20 common holdings. “Our reading” marks a classification that follows the definition without a Publication 559 sentence naming the asset.

The rule that matters for fund investors is 1014(c): the basis section “shall not apply to property which constitutes a right to receive an item of income in respect of a decedent under section 691.” That is why a traditional IRA full of non-traded REIT shares does not step up while the same shares in a taxable account do. Our step-up in basis guide covers the stepped-up side, our non-traded REIT and BDC heirs page covers repurchase waivers, and the inherited IRA 10-year rule page covers the withdrawal clock.

The section 691(c) deduction: real for large estates, $0 for most

The tax code gives the IRD recipient relief from paying estate tax and income tax on the same dollars. Section 691(c)(1)(A) allows “a person who includes an amount in gross income” a deduction in that same year for the estate tax attributable to the item. Four details decide whether it is worth anything.

• It needs federal estate tax actually paid. The statute defines estate tax as “the tax imposed on the estate of the decedent or any prior decedent under section 2001 or 2101, reduced by the credits against such tax.” The credit shelters the first $15,000,000 in 2026 (Rev. Proc. 2025-32, section 70106 of the 2025 law). A state estate or inheritance tax is not a tax under 2001 or 2101, so our reading is that it does not feed the deduction. The rules for Minnesota, New York and the rest are on our state estate and inheritance tax list; the federal side is on our estate tax exemption page.
• It is a proportion. Estate tax attributable to the IRD is “the excess of the estate tax over the estate tax computed without including in the gross estate such net value”. The heir deducts the share of that tax equal to the IRD included in income over the total IRD in the estate.
• Itemizers only. Publication 559: “Individuals can claim this deduction only as an itemized deduction on line 16 of Schedule A (Form 1040).” A 2026 joint filer who takes the $32,200 standard deduction (unmarried: $16,100) gives the deduction up.
• It works year by year. The deduction is allowed “for the same taxable year” the IRD is included, so a 10-year IRA distribution spreads it over 10 returns.

The IRS example is small. J. Sage’s estate owes $9,460 after credits; without the $15,000 of net IRD ($12,000 of fees and $8,000 of bond interest, less $5,000 of business expenses) it would owe $4,840, so the tax that qualifies is $4,620. An heir who collects the $12,000 receivable deducts $12,000 / $20,000 x $4,620 = $2,772 (Publication 559, Estate Tax Deduction).

A 2026 estate large enough for the deduction (our arithmetic)

Take a single decedent with a $20,000,000 gross estate, no other deductions, and a $2,000,000 traditional IRA as the only IRD. Tax under 26 U.S.C. 2001(c) is $345,800 plus 40% of the excess over $1,000,000, less the credit on the $15,000,000 exclusion.

For the reader this page is written for, the usual result is the opposite. An estate of $3,000,000 owes no federal estate tax, so the same IRA carries a 691(c) deduction of $0, and the inherited-IRA income tax is the whole bill. The planning question is the 10-year withdrawal schedule, not the deduction. If the estate is large enough to owe federal tax, the executor’s Form 706 will show the IRD items, and the heir’s preparer needs that number.

A 2026 calendar: death on June 10, 2026 (our arithmetic)

For appraisal evidence at death see our date-of-death appraisal page and our Form 706 instructions guide.

What a reader can do with this

• Decide whether you need Form 1310 before printing it. If you are a surviving spouse filing jointly, or a court-appointed representative filing the original return, the answer is no. If you are an heir without an appointment and the return shows a refund, it is line C.
• Get the court certificate first if a refund is large. Letters of appointment turn a line C claim into a simpler filing, and a will or power of attorney will not do.
• Mark the date-of-death split on every statement. Ask each fund sponsor, bank and custodian for the K-1, 1099 and distribution amounts before and after the date of death. Publication 559 includes a worksheet for reconciling Forms W-2 and 1099 between the decedent, the estate and each heir.
• Sort the holdings. Use the 20-row table to see which ones are on the final return, which are IRD, and which take a date-of-death basis.
• Ask whether federal estate tax was paid. If not, there is no 691(c) deduction, and an inherited-IRA schedule should be built on income tax alone.
• Keep the standard-deduction trap in mind. If the estate did pay tax, an heir has to itemize to use the deduction in each year of withdrawal.

Which holdings to sell, convert or draw down first, and whether a Form 1310 claim, an amended return or a Form 706 election helps, depends on the whole estate and on state rules; that is a conversation for an attorney and a preparer.

FAQ

Sources, read and saved on October 22, 2026: Form 1310 and its instructions (Rev. December 2025) and the About Form 1310 page (reviewed March 31, 2026), irs.gov; IRS Publication 559, Survivors, Executors, and Administrators (2025), irs.gov; 26 U.S.C. 691, 1014, 2001, 2010, 6012 and 6013 and 26 CFR 1.691(c)-1, Cornell Legal Information Institute; Rev. Proc. 2025-32, irs.gov. Worked examples labelled “our arithmetic” are ours, not the IRS’s. This is analysis of public documents, not investment, legal or tax advice.