The estate 1041 is a most complex of entities. The first return can be on a calender year, ending December 31 and due to the IRS on April 15th. Many attorneys choose this, because it's the easiest to remember. Or, the Executor can choose a fiscal year, starting on the date of death and ending on the last day of the month 11-ish months later. This is particularly useful for an estate that will be closed quickly, as it allows the return to be both initial and final.

But then you get the other event that triggers the estate return -- the closing of the estate. The 1041 is due to the IRS 3 1/2 months after the end of the month in which the estate closes. Even when the reporting documents aren't going to be received at that time.

The 1099 is a distribution to the estate, but if the estate is closing, any tax will be pushed out to the beneficiaries (estates should never owe income tax in the year they close, unless there were no assets left to distribute ... but then there wouldn't be any income tax owed either ... ).

The dance of final fees, final tax return filing, and who pays whom when, isn't simplified by the rules of probate -- all debts must be paid and assets distributed -- versus tax law, where you can't always write a complete return without all the paperwork. As a preparer of taxes, I explain to my clients that the estate won't owe taxes (but the heirs might), and I allow the estate to pre-pay me for the preparation. We discuss the due date of the return, and set up an appointment to make sure it gets done when it has to. The Executor can then certify to the probate court that the tax situation is taken care of, the attorneys can be paid off, the remaining funds distributed, and the Executor is usually a lot more relaxed when I meet them a couple months later ... That's for smaller estates where I'm talking to the Executor. I also sometimes deal with an attorney, who has asked for the tax return to be written as part of the estate closing. In this case, all that you can do is get the best information about income that you can, and amend if necessary when the final reporting documents are received. The attorney is trying to make sure all the paperwork is handled before they declared it "closed" and that's not a bad thing.

I would just file the return like the attorney wants. Then you can file another return to close the estate. It will be easier to deal with the attorney and he or she may provide additional business in the future.