Form 1041: Basic Trust & Estate Income Tax Preparation (Part 1) (Currently Unavailable)

Author: Klaralee R. Charlton

This course is part 1 of a two-part course on Form 1041 and the concepts involved in the federal taxation of trust and estates. Instructor Klaralee Charlton will help you understand the basic concepts involved in how trusts and estates are taxed. She will show you where the tax questions move from that of the decedent into that of the estate and any related trusts. With this course, you’ll learn the concepts and steps you’ll need to understand to complete Form 1041 and advise clients on the necessary steps to properly report the income of an estate or trust.

Publication Date: November 2019

Designed For
This course is designed for all CPAs, EAs, estate planners and financial planners who advise clients on tax issues related to estates and trusts.

Topics Covered

• What is Form 1041?
• When to Use a Form 1041
• Entities Using Form 1041
• Types of Trusts
• Requirements to File a Form 1041
• Terms of a Trust or Estate Plan
• Example: Estate/Trust Earns $100 Income
• Types of Estates
• Types of Trust Terms
• 2018 Income Tax Rate ” Trusts vs Individual
• Grantor Trust Returns
• Statement of Income, deductions and credits attributable to grantor
• Fiscal vs. Calendar Year
• Estate — Calendar Year — Date of Death 7/4/18
• Benefits of Filing Based on Fiscal Year Ex.1
• Benefits of Filing Based on Fiscal Year Ex.2
• Short & Fiscal Year Accounting Headaches
• 1099” Div Detail
• 1099”B Detail
• Schedule K”1 From Partnership
• Form 1041 Due Date
• Form 1041 Extensions
• I.R.C. § 645 Election
• Form 8855
• Example 1: Calendar Year Trust and Estate
• Example 1: Calendar Year Trust & Estate Filing Together Under § 645 Election
• Example 2: Calendar Year Trust & Fiscal Year Estate
• Example 2: Calendar Year Trust & Fiscal Year Estate
• IRC § 645, Treas. Reg. § 1.645”1
• Making and Ending the 645 Election Illustration
• Miscellaneous Selections
• Types of Income
• Types of Deductions
• Income Distribution Deduction
• I.R.C. § 663(b) Election
• IRC § 1014 BASIS ADJUSTMENT

Learning Objectives

• Recognize what is Form 1041
• Identify when to use Form 1041
• Describe the types of trusts
• Recognize tax year options and due dates
• Identify how to combine the taxable trust and estaate
• Describe types of income and deductions
• Recognize beneficiary of Schedule K-1
• Identify under what circumstances will a tax preparer advise a client to file a Form 1041
• Recognize which taxpayer will a preparer need to consider filing a Form 1041
• Identify the benefits of filing on a fiscal year
• Identify under what circumstances may a Trust file Form 1041 on a fiscal year
• Describe which type of income requires a mandatory allocation of expenses
• Recognize which deduction was not limited by the Tax Cuts and Jobs Act
• Recognize which distributions can an estate claim an income distribution deduction
• Describe which trust may claim an income distribution deduction
• Identify what a trust or estate that makes a 663(b) election receives an extension should do
• Recognize taxable gain on a sale
• Differentiate which assets would not receive a basis adjustment under IRC 1041
• Describe what it means if a taxpayer dies "testate"
• Recognize which trust must file Form 1041
• Identify what elections should be made
• Identify which type of deduction tax exempt income proportionately reduces
• Recognize a trust's net taxable income
• Identify the requirements when taking a charitable distribution deduction on Form 1041

Level
Basic

Instructional Method
Self-Study

NASBA Field of Study
Taxes (4 hours)

Program Prerequisites
None

Advance Preparation
None