Form 1041: Advanced Concepts in Fiduciary Income Tax (Part 2)

Author: Klaralee R. Charlton

This self-study course looks at the more advanced concepts in fiduciary taxation and how those are applied on Form 1041. Distributable Net Income is covered in more detail and how trusts are reflected on the return get a closer look as instructor Klaralee Charlton applies the concepts learned in Part 1 and extends those concepts into how they apply to a Form 1041 for a complex trust.

Publication Date: November 2019

Designed For
All CPAs, EAs, estate planners, financial advisors and others who advise clients on estate and trust matters would benefit from this course.

Topics Covered

• Advanced Pecuniary Bequests
• Marital Share Funding
• Types of Funding Mechanisms
• Tax Consequences of Funding the Marital Share
• Income Distribution Deduction: Revisiting Distributable Net Income
• Schedule K‐1: Hints and Tips
• Treas. Reg § 1.652(b)‐3: Allocation of Expenses Against Income
• Income from Pass‐Through Entities
• Effects of I.R.C. § 199A on Entities and Beneficiaries
• Separate Share Rule: I.R.C. § 663(c)
• I.R.C. § 643(e)(3) Election: To Recognize or Not to Recognize Gain or Loss
• Grab Bag of Form 1041 Filing Issues
• Complex Trust Case Study

Learning Objectives

• Recognize advanced pecuniary bequests
• Identify and apply marital share funding and formulas
• Recognize advanced income distribution deductions
• Identify how to allocate income and expenses
• Describe 643(e)(3) Election Options
• Identify the Separate Share Rule
• Recognize Charitable Deductions
• Recognize and apply installment sales
• Describe passthrough Entity Income Issues
• Identify 199A issues
• Recognize what qualifies as a specific bequest
• Identify which funding methods passes exactly the amount of property necessary to achieve zero estate tax
• Describe the goals the optimal funding formula achieves
• Recognize which funding plans would trigger unanticipated gain under Internal Revenue Code Section 1040
• Identify which trust may claim an income distribution deduction
• Recognize what would be reported on a beneficiary's schedule K-1
• Identify under which scenario a Trust may claim the FULL Qualified Business Income (QBI) Deduction
• Recognize which income distribution deductions is permissible

Level
Basic

Instructional Method
Self-Study

NASBA Field of Study
Taxes (4 hours)

Program Prerequisites
None

Advance Preparation
None