Why was the estate exemption of $600 eliminated on the Form 1040 for a final return?

The exemption is $100 unless the return is one of the following: 

• A simple trust and 1041 screen 1 has the Distribute all income box checked. In this case, the exemption is $300 because a trust whose governing instrument requires that all income be distributed currently is allowed a $300 exemption, even if it distributed amounts other than income during the tax year.
• A decedent's estate, in which case a $600 exemption is allowed.
• A qualified disability trust, in which case a $4,300 exemption is allowed.
• A final year estate or trust return, in which case no exemption amount is allowed.
  • An exemption amount is not figured or passed through to the beneficiaries in the final year. Per the 1041 instructions, page 27, "If the estate or trust has for its final year deductions (excluding the charitable deduction and exemption) in excess of its gross income, the excess is allowed as an itemized deduction to the beneficiaries succeeding to the property of the estate or trust." 
  • See the screen MISC in data entry for more information. 

On the other hand, I did a 1041 for an estate that was marked "Final" because everything was distributed to the beneficiaries shortly after the end of the year so there would be no income for the following year, and therefore no filing requirement.  The trust owed tax, mostly on capital gains, but the beneficiaries preferred it didn't flow through to their own returns.  I didn't claim a $600 exemption, probably because the software didn't allow it and I didn't stop to think whether it should.  Four months later they get a refund check for $120 -- 20% tax rate times $600 exemption.  This was confusing because there also happened to be $120 withholding claimed on a small annuity distribution.  After reviewing the rules, I figured out that there are some situations where a "Final" return still qualifies for the exemption.