Stock sale gets reported on 1041. If this is a first and final 1041 the gain will pass out to the beneficiaries on K-1s and they pay the tax. The basis for the stock is the date of death value.

If not final, the estate pays the income tax on the gain, which includes net investment income tax.

The "estate exemption" applies to the value of the estate for estate tax purposes. There is no income tax exemption.