Estate and Trust Taxes

IRS Form 1041 is an income tax return for estates and trusts, similar to Form 1040 for individuals. If you are the executor for an estate, you may be required to file Form 1041 – U.S. Income Tax Return for Estates and Trusts. Form 1041 must be filed for the person who died in addition to any personal income tax return you need to file on his or her behalf.

These forms are used to report and transmit withheld tax on payments or distributions made to nonresident alien individuals, foreign partnerships, or foreign corporations to the extent such payments or distributions constitute gross income from sources within the United States that is not effectively connected with a U.S. trade or business. For more information, see sections 1441 and 1442, and Pub. 515, Withholding of Tax on Nonresident Aliens and Foreign Entities.

The different types of 1040 forms are accordingly:

• Form 1040, U.S. Individual Income Tax Return.
• Form 1040NR, U.S. Nonresident Alien Income Tax Return.
• Form 1041-A, U.S. Information Return Trust Accumulation of Charitable Amounts.
• Form 1042, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons, and Form 1042-S, Foreign Person’s U.S. Source Income Subject to Withholding.

For example, say an unmarried person died on June 30. As the executor, you file a final personal tax return for that person for the first half of the year. After death, everything that person owned becomes part of his or her estate. You file Form 1041 for the estate for the remainder of the year. Don’t confuse the Form 1041 income tax return for the estate, and an estate tax return. The income tax return is for income and other tax items on an estate before it is settled.

The fiduciary (or one of the joint fiduciaries) must file Form 1041 for a domestic estate that has:
• Gross income for the tax year of $600 or more, or
• A beneficiary who is a nonresident alien.

An estate is a domestic estate if it is not a foreign estate. A foreign estate is one the income of which is from sources outside the United States that is not effectively connected with the conduct of a U.S. trade or business and is not includible in gross income. If you are the fiduciary of a foreign estate, file Form 1040NR, U.S. Nonresident Alien Income Tax Return, instead of Form 1041.

When to File
For calendar year estates and trusts, file Form 1041 and Schedule(s) K-1 on or before April 15, 2015. For fiscal year estates and trusts, file Form 1041 by the 15th day of the 4th month following the close of the tax year. For example, an estate that has a tax year that ends on June 30, 2015, must file Form 1041 by October 15, 2015. If the due date falls on a Saturday, Sunday, or legal holiday, file on the next business day.
Where to File
Domestic Trust files with the Department of Treasury, IRS. If foreign country or US possession, then IRS.

Overall, this is an intricate process that is best done with the help of professionals.  If you wish to file a 1040 or want more information, schedule a consultation with the experienced attorneys at EPGD Law today, located in beautiful Coral Gables. Call us at (786) 837-6787 or e-mail us to schedule a consultation. – See more at:

EPGD Business Law is located in beautiful Coral Gables, West Palm Beach and historic Washington D.C. Call us at (786) 837-6787, or contact us through the website to schedule a consultation.

*Disclaimer: this blog post is not intended to be legal advice. We highly recommend speaking to an attorney if you have any legal concerns. Contacting us through our website does not establish an attorney-client relationship.*

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