Form 1041: Tax Compliance, Review and Planning - Intermediate

Author: Michael Miranda

Per the IRS Education Provider Standards this course must be COMPLETED by 12/31/2028 to receive credits. NOTE: Go to My Professional Profile in your CCH CPELink account settings to ensure your name, and PTIN number; matches your PTIN card

This course will walk you through the preparation of a current year Form 1041 return, that includes income, expense, distributable net income (DNI), tax computations, and the various return questions that are unique to trusts and estates. With the elimination of the 2% itemized deduction (under the Tax Cut Jobs Acts), the IRS and Treasury developed a new taxation regime to handle any excess deductions upon the termination of a Trust or Estate. We will explore these changes, how it is handled by the Trust and how it is ultimately handled by the beneficiaries. We will explore the trust features of a Charitable Remainder trust and why a client might utilize such a planning vehicle in their estate plan. The course will include a discussion of the Grantor Trusts and highlight the unique tax law provisions associated with this type of Trust. We will close the course with a discussion of several post-mortem planning opportunities and a case study that utilizes an Intentionally Defective Grantor Trust (IDIT) to transfer assets to a client’s heirs.

Publication Date: January 2025

Designed For
All tax professionals who desire a better understanding of the fiduciary tax including the Form 1041 return reporting and be able to understand the flow of income from a trust to a beneficiary.

Topics Covered

• What "Advisors" should know about trusts and estates
• Types of trusts - by purpose
• Excess deductions upon termination of a trust or estate
• Distributions in kind and non-pro-rata distributions
• Income in respect of a decedent (IRD)
• Postmortem planning - IRC §645 Election
• Grantor trust rules
• Charitable Trust (CRTs)
• Planning example using an IDIT

Learning Objectives

• Identify how to compute income, deductions and credits for a Trust or an Estate (continuation of the Beginners course)
• Identify how to handle the excess deduction upon the termination of a Trust or an Estate
• Identify the forms, filing dates, and requirements for a decedent’s Estate
• Identify the unique aspects of a Grantor Trust
• Explain how to prepare a current year’s Form 1041
• Identify the unique traits associated with Charitable Remainder Trusts
• Explain how to utilize several post-mortem planning techniques associated with Trusts and Estates
• Identify a wealth transfer technique using a “special purpose” Trust

Level
Intermediate

Instructional Method
Self-Study

NASBA Field of Study
Taxes (2 hours)

Program Prerequisites
Completion of Form 1041 – Tax Compliance, Review and Planning – Beginners

Advance Preparation
None