I guess I'm getting myself more confused. Here's the entire situation:

1. Client passed 7/20
2. Executor sold stock 9/20 under the estates FEIN number with a LT gain of $215,798 using original cost basis. This is the only income for the estate.
3. The cash from the sale was distributed to the beneficiaries.

Questions:

1. Which for does this get reported on, 1041 or 706? I was assuming 1041.
2. Should I be using a stepped up basis for the stocks as of clients date of death?

I appreciate your help on this

Steve