I am paying a deceased employee's worked and vaction hours to the estate of the employee. Is this amount a 1099 reportable payment?


If the payments are made in the same year of the employee’s decease, amounts paid to the estate are reported on a 1099-MISC; but social security and Medicare should be withheld and reported on a W-2, only as social security and Medicare wages, i.e., in box 3 and box 5 (and show withheld amounts in the appropriate boxes 4 and 6), but do not show the payment in box 1.

If the payments are made in the year following the year of the employee’s decease, then you simply report the payments to the estate on a 1099-MISC. This is according to IRS information reporting customer service agent Ebersoll (ID# 0705421).

See page 5 of the IRS Instructions for form W-2 and W-3.

Have more questions? Submit a request