Final answer:
Estates must file a tax return when gross income is $600 or more, or if a beneficiary is a nonresident alien. Trusts file when they have any taxable income or gross income of $600 or more. The estate tax usually applies to high-value estates.
Step-by-step explanation:
Estates and trusts have specific requirements for when they must file tax returns. For estates, a return is necessary when the estate's gross income for the tax year is $600 or more, or if a beneficiary is a nonresident alien. Trusts, on the other hand, must file when they have any taxable income for the tax year, or gross income of $600 or more regardless of the amount of taxable income. Additionally, the threshold for the estate tax applies to larger estates. As per the Center on Budget and Policy Priorities, in 2015 the estate tax only affected inheritances over $5.43 million, making it relevant for a small percentage of wealthy individuals.