Which values and dates should I document for an estate distribution that may include taxable income?

From a tax compliance standpoint, the beneficiary should match the tax documents to the type and timing of the distribution rather than assuming the entire payment is tax free. When preparing the return, retirement distributions and other income in respect of a decedent can also have separate tax treatment. For tax reporting purposes, basis and fair market value records are often the key evidence when property is later sold or distributed. Save the original records used to determine the tax treatment, and ask a CPA, enrolled agent, or tax attorney to confirm who reports the item, which form applies, the basis used, and the due date.