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Imagine getting a note like this:
“My dad died in October. His Social Security still landed in his bank account in November, and my sister says we should just leave it there. Now I’m also wondering: Does Dad still have to file a tax return? Who signs it? We’re lost.” — Mark
Mark isn’t a real reader. He’s a composite of a situation many families face after a parent dies, so let’s walk through it the way I would for a friend.
I’ve been a CPA since 1981, and I was the executor of my parents’ estate. So I’ve seen this paperwork from both sides of the desk.
First, the bad news for Mark’s sister. Social Security doesn’t pay benefits for the month someone dies, so the payment that arrives the following month has to go back (1).
Second, yes: Dad likely still has a tax return to file. The IRS says the final return is due when it would have been due if he were alive (2).
And even if his income was low, a return is the only way to get back tax that was withheld from his pension, wages or annuities (2).
The IRS puts it plainly to whoever files: “It’s your responsibility to pay any balance due and to submit a claim if there’s a refund” (3).
Here are five things Mark’s family, and maybe yours, needs to do.
1. Send back the Social Security payment
This is the one that catches families off guard. Benefits are paid a month behind, so a check or deposit received in August is actually the payment for July (1).
If Dad died in October, the payment that arrives in November covers October, and it must be returned (1). If it came by direct deposit, ask the bank to return the payment for the month of death and any that arrived later (1).
Don’t spend it, and don’t let a sibling talk you out of it. It isn’t Dad’s money.
2. File Dad’s final tax return
Whether Dad has to file depends on his gross income, age and filing status (2). But if any tax was withheld from wages, pensions or annuities, a return is the only way to claim it back (2).
The return is due on the normal date, so for a death in 2026 that means the spring 2027 filing deadline (2). Write “DECEASED,” Dad’s name and his date of death across the top (2).
If Dad also left investments or an IRA, the tax decisions get bigger fast.
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3. Figure out who signs
If a personal representative, such as an executor, has been appointed, that person must file the final return (2). If Mom is still living and files jointly with Dad for the year he died, she signs too (2).
If no personal representative has been appointed before the due date, a surviving spouse can file the joint return on her own (2).
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4. Claim any refund the right way
If Dad’s final return shows a refund, Form 1310 is generally needed to claim it, with two exceptions (2): a surviving spouse filing a joint return, or a court-appointed or certified personal representative filing Dad’s original return with a copy of the court certificate attached (2).
If you’re acting as Dad’s fiduciary, you must also file a written notice of that relationship with the IRS, usually on Form 56 (2).
And if the opposite happens and Dad owed back taxes, deal with it before you distribute anything.
If you need help sorting out an IRS balance, you can compare tax relief options and talk with a professional before you decide anything.
5. Check whether the estate files its own return
Dad’s estate can be a separate taxpayer. A decedent’s estate must file Form 1041 if it has gross income of $600 or more for the tax year (4).
That’s a low bar, in my view, so check before you assume the estate is too small to matter.
My honest take
When a parent dies, nobody wants to think about the IRS or Social Security. I get it. But these are the steps that cost families money when they’re skipped, and the clock starts right away.
Make a list. Return what has to be returned. Then take the tax deadlines one at a time.
And then do one more thing: get your own paperwork in order, so your kids never have to write a note like Mark’s.
Sources: 1. USA.gov; 2. IRS Publication 559; 3. IRS; 4. IRS Instructions for Form 1041
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