Estate Planning - Taxes

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How to Protect Your Property from the Estate Recovery Act

The Estate Recovery Act technically isn’t a tax, but it involves the government taking money out of your estate after you die. In fact, the Estate Recovery Act can have a far more devastating impact on [more…]

Making Sense of Your State's Inheritance and Estate Taxes

Some states are repealing or phasing out their inheritance or estate taxes, but other states that currently don’t have estate-related taxes are instituting an inheritance or estate tax. Whereas most state [more…]

Using Will Substitutes to Reduce Estate Taxes

Why would you want to use a will substitute (a legal agreement that transfers ownership upon your death) rather than your will for certain property? Property covered by a will substitute is transferred [more…]

Federal Laws Help Ease Tax Burden in Estate Planning

The federal tax system includes a gift tax, generation skipping transfer tax (GSTT), and estate (death) tax that work together to make as much of your estate as possible disappear. The laws and rules for [more…]

Is Your Estate Subject to Federal Estate Tax?

You may be one of the few people whose estate would have to pay federal gift or estate taxes, meaning that some of your “stuff” may end up going to Uncle Sam. How do you know if you’re in that situation [more…]

Top Tips for Reducing Estate Taxes in Canada

Though Canada doesn’t have any “death taxes,” taxes on your estate, including your Registered Retirement Savings Plans (RRSPs) and Registered Retirement Income Funds [more…]

How to Submit a Trust’s Final Income Tax Returns

You can’t walk away from your duties as trustee until and unless you’ve filed a final Form 1041, U.S. Income Tax Return for Estates and Trusts. Before terminating the trust, you will need to ensure that [more…]

How to Complete Schedule C for Estate Form 706

An estate administrator should report assets like mortgages, cash, and promissory notes on Schedule C: Mortgages, Notes, and Cash when filing tax Form 706. [more…]

How to Complete Schedule B for Estate Form 706

An estate’s administrator must complete Schedule B: Stocks and Bonds when filing Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return [more…]

How to Complete Schedule A for Estate Form 706

An estate’s administrator must complete Schedule A: Real Estate when filing Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return [more…]

How to Prepare Supplements to Schedule K-1 for Estates and Trusts

While Schedule K-1for estates and trusts has space for much information, the fiduciary may want to give the beneficiaries more via supplements. The more information the better, including medical expenses [more…]

Recapture and Household Employee Taxes for a Decedent, Estate, or Trust

When you file taxes for a decedent, estate, or trust, you may have to pay recapture taxes or household employee taxes. Recapture and household employee taxes are included on Schedule G of Form 1041. For [more…]

How to Calculate the Estate Tax Deduction

The estate tax deduction deals with items of Income in Respect of Decedent (IRD). Income in Respect of Decedent items can be subject to both the estate tax and an income tax. The estate tax deduction compensates [more…]

How to Calculate Estate or Trust Income Distribution Deductions (Schedule B)

The Income Distribution Deduction (Schedule B) is unique to trusts and estates. When trusts and estates give income payments to beneficiaries, those payments carry income tax consequences for the trust [more…]

How to Complete Schedule F for Estate Form 706

Use Schedule F: Other Miscellaneous Property Not Reportable Under Any Other Schedule, when filing federal estate tax returns (Form 706), to report property that doesn’t belong on any other schedule. Be [more…]

How to Complete Schedule E for Estate Form 706

Use Schedule E: Jointly Owned Property,when filing federal estate tax returns (Form 706), if the decedent held property of any kind jointly at his or her death. Report property held jointly with the decedent’s [more…]

How to Complete Schedule D for Estate Form 706

An estate administrator uses Schedule D: Insurance on the Decedent’s Life, when filing a federal estate tax return (Form 706), to report any and all policies on the life of the decedent. Policies that [more…]

How to Calculate Trust Accounting Income

As a trustee, you may need to use the Trust Accounting Income (TAI) formula to calculate the amount of income from the trust that you can distribute to beneficiaries. In some cases, you will need to use [more…]

How to Create a Payment Schedule for a Trust

As a trustee, you should establish a payment schedule for the trust to ensure that the trust has enough money when you make distributions to beneficiaries and when you pay taxes and service fees. To create [more…]

Schedule K-1 for Estates and Trusts: General Information

An estate or trust’s income retains its character, and so beneficiaries must be informed of this character. The Schedule K-1 (Form 1041) gives the beneficiary the specific allocation between all items [more…]

Schedule K-1 for Estates and Trusts: Alternative Minimum Tax

As fiduciary, you will pass through all the tax preference items to the income beneficiaries of the estate or trust on Schedule K-1, line 12, along with their income distribution. [more…]

How to Allocate Income on Schedule K-1 for Estates and Trusts

Income earned by a trust or estate that’s paid out to a beneficiary in the same year as it’s earned must be reported to that beneficiary on Schedule K-1, and that income maintains its character when it’s [more…]

Schedule K-1 for Estates and Trusts: Income Items

The best Schedule K-1 is the one that breaks down the income information into its component parts. Just because the trust or estate’s tax returns don’t require certain information, doesn’t mean the beneficiaries [more…]

Meet Probate Court and Tax Deadlines for Estates and Trusts

You must meet all probate court deadlines to avoid being removed as executor or trustee and to avoid fines or even jail sentences. File income tax returns, Form 1041, and estate tax returns, Form 706, [more…]

How to Deduct Fiduciary Fees for an Estate or Trust

When preparing an estate or trust’s income tax Form 1041, you may deduct fiduciary fees. Fiduciary fees are the amounts executors, administrators, or trustees charge for their services. If you’ve figured [more…]


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