Estates and Trusts
Estates and trusts must file income tax returns, just as individuals do, using IRS Form 1041. If trust and estate beneficiaries are entitled to receive income from the estate or trust, they must pay income tax, rather than the trust or estate, using Schedule K-1.
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Determining the tax liability for an estate or trust or for its beneficiaries can be complicated, especially since this is often a unique situation for the fiduciary or beneficiary. We help you file taxes for your estates and trusts.
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We Simplify the Tax Accounting Process for You
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For more than thirty years, Melissa Ochoa has worked with attorneys and estate and trusts beneficiaries on a wide range of estate and trust work. As your tax accountants, we can help you determine your tax liability.
Form 706
The executor of a decendent’s estate uses Form 706 to figure the estate tax imposed by the Internal Revenue Code. Form 706 is also used to compute the generation-skipping transfer (GST).
Form 1041
According to the IRS, Form 1041, U.S. Income Tax Return for Estates and Trusts, must be used by the fiduciary of a domestic decedent’s estate, trust, or bankruptcy estate to report:
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Income, deductions, gains, losses, etc. of the Estate or Trust
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Income that is either accumulated or held for future distribution or distributed currently to the beneficiaries
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Income tax liability of the estate or trust
Schedule K-1
The trustee or fiduciary of the estate must issue a Schedule K-1 to allow beneficiaries to correctly report income on their personal tax return. Beneficiaries of a trust or estate need to fill out the Schedule K-1.
Tax & Retirement Planning
If you are a few years away from retirement, it’s important to start thinking about how you will manage the “spend down’ of your retirement savings from a tax perspective. You need to know how your Social Security payments will be taxed, and when would be the best time to tap into your IRA’s. Melissa and her team can help you understand your options and plan for your future . Learn more about our strategic tax planning services by clicking below.