Interest income from an expropriation settlement reported on a T5 slip after an individual's death should be handled as part of the deceased's final tax return or be reported as income for the estate, depending on when the income was accrued.
Interest income from an expropriation settlement reported on a T5 slip after an individual's death should be handled as part of the deceased's final tax return or be reported as income for the estate, depending on when the income was accrued.
Here are the general steps you'll need to follow in TurboTax:
Determine the Timing of the Income: Establish whether the interest income was accrued before or after the date of death.
- Before Death: If the income was accrued before the individual's death, it should be included in the final return (also known as the Terminal Return).
- After Death: If the income was accrued after death, it's generally considered the income of the estate.
Entering in TurboTax:
- For the Final Return: Go to the "Income" section, find the area for T5 slips, and enter the information as you normally would if dealing with the deceased's tax matters.
- For the Estate: If dealing with an estate (a separate legal entity which should have its taxpayer identification number), you'll need to file a T3 Trust Income Tax and Information Return instead. TurboTax has a version that supports T3 returns, so ensure you are using the appropriate version.
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