For income tax purposes, the estate's initial taxable period for a decedent who died on October 24:
a. Must be a fiscal year beginning on the date of the decedent's death.
b. May be either a calendar year, or a fiscal year beginning on October 1 of the year of the decedent's death.
c. Must be a calendar year beginning on January 1 of the year of the decedent's death.
d. May be either a calendar year, or a fiscal year beginning on the date of the decedent's death.
Answer:D
Choice "d" is correct.
Rule: An estate may elect either a calendar year or a fiscal year for the estate income tax return. (Note: Trusts, with limited exceptions, must use a calendar year end.)
Choices "a", "b", and "c" are incorrect, per the above rule.