Ian Bryzek, CPA
Unused vacation or PTO paid after death
Payouts for unused leave should be identified separately from regular wages.
A vacation payout can arrive on a different check or ACH than the final wages. Label it clearly in the income list.
Leave payouts are still compensation records and should be matched to employer reporting.
What to keep with the file
Leave payouts are still compensation records and should be matched to employer reporting.
What to do next
Add the leave payout as its own line on the year-of-death income worksheet.
What to gather
- Employer leave-payout letter or policy excerpt
- Payment stub or ACH detail
- Deposit record
- Form W-2 or correction if issued
- Note of recipient account
Who usually handles what
- Ian can organize the tax reporting question and the supporting records.
- The executor, trustee, or account custodian supplies records and confirms who has authority to act.
A practical next step
Add the leave payout as its own line on the year-of-death income worksheet.
Related guides
This is general tax information, not tax or legal advice. Outcomes depend on the documents, ownership, timing, and law that apply to the particular facts.