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 2021
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
- Income Distribution Deduction
- Schedule K”1: Hints and Tips
- Treas. Reg § 1.652(b)”3: Allocation of Expenses Against Income
- Advanced Pecuniary Bequests
- Marital Share Funding
- Schedule K”1: Hints and Tips
- Treas. Reg § 1.652(b)”3: Allocation of Expenses Against Income
- Sub Trust Funding Formulas
- Types of Funding Mechanisms
- Tax Consequences of Funding the Sub Trusts
- Sales of Entities and Income from PassThrough 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
- Income in Respect of a Decedent
- Charitable Deduction
- Tax Credits and Withholding Obligations
- Complex Trust Case Study
Learning Objectives
- Recognize advanced income distribution deductions
- Identify how to allocate income and expenses
- Recognize advanced pecuniary bequests
- Describe marital share funding & formulas
- Identify passthrough Entity Income Issues
- Identify 199A issues
- Recognize 643(e)(3) Election Options
- Describe 643(e)(3) Election Options
- Identify Charitable Deductions
- Recognize which IRC Sections prescribes the rules with respect to the income distribution deduction
- Identify the lowest tax rate applicable to trust taxable income
- Identify the top trust income tax rate
- Describe what represents a type of principal with respect to a trust/estate
- Differentiate which IRS Forms are used to request a taxpayer's identification number and certification
- Identify the withholding rate for distributions of income to a foreign beneficiary
- Describe common types of potential IRD
- Identify the most important takeaways from the course
Level
Basic
Instructional Method
Self-Study
NASBA Field of Study
Taxes (6 hours)
Program Prerequisites
None
Advance Preparation
None
Instructor
Klaralee R. Charlton
Klaralee Charlton is a Partner at 3i Law in Denver, Colorado. She practices fiduciary tax, estate administration, and business transactional law. As part of her practice, she guides clients through the process of administering a loved one’s estate including the collection, valuation, management and transfer of assets including financial accounts, real estate, and business interests with a focus on minimizing estate and income tax liability. Klaralee also works closely with trustees of ongoing trusts to ensure compliance and prepares clients’ fiduciary income tax returns annually.
Klaralee has written and lectured on topics including estate and gift tax, fiduciary income tax reporting and U.S. regulations governing the valuation of small family businesses. She is an active member of the Colorado Bar Association, Tax Section and Adjunct Profession at the University of Denver, Graduate Tax Program.
She earned her J.D. in 2011 from the University of Utah, S.J. Quinney College of Law, her LL.M. in Tax Law from the University of Denver in 2013, and her B.A. in political science in 2009 from Bryn Mawr College. She is admitted to practice in both Colorado and Montana.