Answer ID 1402 | Published 01/21/2004 09:32 AM | Updated 08/01/2024 01:28 PM
Are prepaid funeral expenses an asset of an estate or a deduction?
Essentially, they can be both an asset and a deduction. The value of the prepaid funeral should be listed on REV-1508 Schedule E - and the actual costs of the funeral services should be listed on REV-1511 Schedule H. If the funeral costs are greater than the value of the pre-payment, the estate gets the advantage of having the additional expense as a deduction. If the funeral costs are less than the value of the pre-payment, the amount refunded by the funeral home is subject to tax. If the amounts are equal, they cancel each other out.
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