How to file the final tax return for a deceased taxpayer

What you nee​d to know:

• When someone dies, their surviving spouse, an executor, or an administrator normally files the deceased taxpayer’s final Income Tax return.
• On the South Carolina Individual Income Tax return, whomever is filing the deceased taxpayer’s return should check the box to indicate the taxpayer is deceased.
• You should use whatever filing status you chose for your federal return on your South Carolina return.

When a family member dies, the deceased person’s surviving spouse or other representative is often faced​ with a cascade of tasks, choices, and emotions. Taxes may seem like a distant concern when someone passes, but preparing to file their final return can ensure a smooth process.

Here are some tax tips from the South Carolina Department of Revenue (SCDOR) on filing a final return for a deceased taxpayer.

Some filing basics:

• Who should file? Usually, if a spouse survives, that person files the return. The filer could also be an executor, administrator, or representative named in the person’s will or appointed by a judge. If none of those exists, a personal representative will file the return.
• Be sure to check the box. When filing the return, check the box for “deceased” next to the appropriate Social Security number. If filing by paper, this box is located at the top of the SC1040.
• Due date. The final return is due by the regular April deadline for Individual Income Tax returns unless the surviving spouse or representative files for an extension.​

Filing status:

Because the South Carolina return starts with what was filed with the IRS, it’s important to choose the appropriate filing status and keep that status on the South Carolina return.

A surviving spouse who does not remarry during the year typically has two options for filing status in the year their spouse passes away:

• Married filing jointly. This filing status offers a higher standard deduction and usually results in a lower Income Tax calculation. It is the most common status used by a couple.
• Married filing separately. A surviving spouse may choose this status if they want to avoid taking responsibility for their deceased spouse’s tax liabilities or if the total tax would be lower by filing separately.

In years after the spouse passes away, a surviving spouse who has not remarried typically has three options for filing status:

• Single. A surviving spouse who does not remarry and does not have any dependents will likely use this filing status.
• Head of Household. This filing status is for those who are unmarried, or considered unmarried, at the end of the tax year, paid more than half the cost of keeping up a home, and had a qualifying person, such as a dependent, living with them for more than half the year. This filing status offers a higher standard deduction than the Single filing status.
• Qualifying Surviving Spouse. This filing status, previously known as Qualifying Widow or Widower, is available for a surviving spouse who still has a qualifying dependent child, stepchild, or adopted child living in their home. To qualify, the surviving spouse must have been entitled to file a joint return in the year the spouse died and must pay more than half the cost of keeping up their home. This filing status is only available for two years after the year the spouse passes away.

Signing the return:

When filing a return for a deceased taxpayer:

• If an appointed representative is filing the return, they must sign it. On joint returns, the surviving spouse also must sign.
• If there isn’t an appointed representative, the surviving spouse filing a joint return should sign and write “filing as surviving spouse” beside their signature.
• If there’s no appointed representative and no surviving spouse, the person in charge of the deceased taxpayer’s property should file and sign as a personal representative.
• When filing electronically, follow the software provider’s instructions on signing.

Survivor deductions:

The deceased taxpayer’s return should include any deductions they were eligible to take based on income earned while they were alive. A surviving spouse may also be able to take additional deductions for income they receive.

• A surviving spouse receiving qualified retirement income on behalf of a deceased spouse may deduct up to $3,000 or $10,000 of the qualified retirement income, based on the age of the deceased spouse if they were alive. The surviving spouse must receive the decedent’s retirement income as a surviving spouse. This is in addition to the surviving spouse’s own retirement plan deduction.
• Taxpayers can deduct all military retirement income included in their South Carolina taxable income. Military retirement income means taxable income received by the taxpayer or the taxpayer’s surviving spouse from a qualified military retirement plan. For a surviving spouse, military retirement income includes a retirement benefit plan and dependent indemnity compensation received due to the deceased spouse’s military service. The surviving spouse military retirement deduction is in addition to any retirement deductions claimed on the taxpayer’s own retirement income.

File an SC 1310 to claim a refund on the deceased taxpayer’s return. Follow the instructions on the SC1310 to determine if you need to send a copy of the death certificate or the court certificate showing your appointment as a representative.

More information:
Read Revenue Ruling 22-11 for details on retirement deductions. For IRS information on how to file the final federal return for a deceased taxpayer, visit this webpage​​.

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