Delaware Fiduciary Income Tax Return (Form FID-TAX): Who Must File and When

The decedent's final personal income tax return gets most of the attention when someone dies. But there is a second tax obligation that catches many executors completely off guard — and missing it carries penalties of up to 50% of the tax owed.

After someone dies, the estate does not simply cease to exist for tax purposes. Any income generated by estate assets after the date of death — interest accumulating in bank accounts, dividends from stocks the estate holds, rent from real estate under administration — belongs to the estate, not to the decedent. That income must be reported on a separate return: the Delaware Fiduciary Income Tax Return, now designated Form FID-TAX (previously filed as Form 400 in older tax years).

Who Has to File

A Delaware resident estate must file Form FID-TAX if the estate had gross income of $600 or more during the taxable year. That threshold is low enough that most estates generating any meaningful interest, dividend, or rental income will hit it.

A non-resident estate must file if it had Delaware-sourced income — income with a direct connection to Delaware, such as rent from Delaware real estate or business income from Delaware operations — regardless of whether the estate itself is administered in Delaware.

Trusts follow the same rules as estates for filing purposes. A Delaware resident trust with gross income of $600 or more files Form FID-TAX. A non-resident trust with Delaware-sourced income does likewise.

The form is filed for each taxable year that the estate or trust exists and generates income. An estate that remains open for two years because of a contested will or slow property sale must file two fiduciary returns.

The April 30 Deadline

Delaware's fiduciary income tax return is due by April 30 of the year following the close of the taxable year. If the estate operates on a calendar year (January through December), the FID-TAX for the prior year is due April 30.

Like all Delaware income tax deadlines, this is April 30 — not the federal April 15 date that many people assume carries over. If the estate is on a fiscal year rather than a calendar year, the return is due on the 30th day of the fourth month following the close of the fiscal year.

Extensions are available using Form FID-EXT, but the extension only provides more time to file the return — not more time to pay any tax due. An estimated payment should accompany any extension request to avoid interest charges.

The $1,000,000 Estimated Tax Trap

Here is the rule that blindsides the most executors.

Under Delaware law, if the fair market value of estate or trust assets equals or exceeds $1,000,000 at any point during the taxable year, the fiduciary is legally required to file quarterly estimated tax declarations (Form FID-EST) for the following taxable year.

That threshold is not as high as it sounds. A middle-class Delaware estate — a primary residence, a 401(k), and a brokerage account — can easily exceed $1,000,000 in combined fair market value even when the family does not think of itself as wealthy. When the estate breach that $1 million mark in Year 1, the executor must begin filing FID-EST declarations in Year 2.

Missing the quarterly estimated payments triggers underpayment penalties on top of the regular late-payment penalties. The Division of Revenue assesses a failure-to-pay penalty of 5% per month (up to 50%) and interest charges on the underpaid amount. Executors who are unaware of this rule have found themselves owing penalties larger than the underlying tax.

The quarterly estimated payment deadlines for most estates on a calendar year are:

• April 30 (for the first quarter)
• June 30 (for the second quarter)
• September 30 (for the third quarter)
• January 15 of the following year (for the fourth quarter)

If the estate is wound up and closed during the year, estimated payments are still required for the quarters in which the estate existed and assets exceeded the threshold.

What Income Goes on the FID-TAX

The FID-TAX covers income generated by estate assets after the date of death. The most common categories are:

• Interest income from bank accounts, money market funds, or bonds held by the estate
• Dividend income from stocks or mutual funds the estate holds before distribution to beneficiaries
• Rental income from real estate under estate administration
• Capital gains from the sale of estate assets, such as stocks liquidated to raise cash for creditor payments or real estate sold under the direction of the will
• Business income if the decedent owned a pass-through business that continues operating during estate administration

The FID-TAX return uses an income tax rate schedule applied to the estate's taxable income. Delaware has a relatively favorable approach to trust taxation: it only taxes the portion of trust income attributable to Delaware resident beneficiaries. If all beneficiaries live outside Delaware, the state tax liability may be minimal even if the estate is large.

The FID-BEN: K-1 Equivalent for Delaware Beneficiaries

When income from the estate is distributed to beneficiaries rather than retained within the estate, the tax obligation generally shifts to the beneficiaries rather than staying with the estate. To document this allocation, the executor must prepare Form FID-BEN for each beneficiary — Delaware's equivalent of the federal Schedule K-1.

The FID-BEN shows each beneficiary's allocated share of the estate's income, deductions, and credits for the tax year. Beneficiaries use this form to report their share of estate income on their own individual Delaware returns.

Failing to prepare and distribute FID-BEN schedules to beneficiaries leaves them unable to file their own returns accurately, creates disputes about how much each beneficiary owes, and can expose the executor to complaints of fiduciary mismanagement.

How This Relates to Form 400

In older references and earlier tax years, Delaware's fiduciary income tax return was called Form 400, and estimated payments were made on Form 400-ES. The Division of Revenue has updated the form designations to FID-TAX and FID-EST in recent years. If you see older resources or county register forms referencing Form 400, they are referring to the same underlying return now called FID-TAX.

Getting the Forms

Current year fiduciary income tax forms — FID-TAX, FID-EST, FID-EXT, and FID-BEN — are published and updated annually by the Delaware Division of Revenue. The official source is:

revenue.delaware.gov/personal-income-tax-forms/

Given that the form designations and thresholds have changed in recent years, always retrieve the current year's version rather than relying on prior-year PDFs. The Division of Revenue also accepts fiduciary returns through the Delaware Taxpayer Portal for online filing.

When You Need a CPA

For most simple estates with modest income from interest and dividends, an organized executor can complete Form FID-TAX without professional help once they understand the mechanics. The form is detailed but not exceptionally complex for straightforward income streams.

However, a CPA becomes essential when:

• The estate is approaching or exceeding the $1 million threshold, requiring estimated payment calculations
• The estate includes business interests with pass-through income and complex deductions
• Capital gains calculations involve a large number of securities with different purchase dates and prices
• There are multiple beneficiaries in different states, creating multi-state tax allocation questions
• The estate is in a fiscal year rather than a calendar year, altering all the filing deadlines

The key value of professional help in the FID-TAX context is avoiding the estimated payment trap. A CPA who specializes in estate administration will immediately flag the $1 million threshold and schedule the FID-EST payments, preventing the penalty exposure that catches lay-executors off guard.

The Delaware Final Tax & Estate Tax Guide covers the full sequence of tax obligations after a death in Delaware — from the final personal income tax return through the fiduciary income tax requirements — alongside the county probate timeline, the Register of Wills inventory and accounting deadlines, and the specific affidavit filings needed to clear real estate titles.

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