Table of Contents
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For 2008, Schedule I will not appear on pages 3 and 4 of Form 1041. Instead, it will be a separate form titled Schedule I (Form 1041), Alternative Minimum Tax — Estates and Trusts (AMT). The filing requirements remain the same for Schedule I as in previous years. If you have to prepare a Schedule I (Form 1041), be sure to include it immediately after the Form 1041. See Assembly and Attachments for information about the correct assembly of the return.
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For 2008, the Instructions for Schedule D and the Instructions for Schedule I will be separate products and will no longer be included in the Instructions for Form 1041.
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For Form 1041 filers, the automatic extension of time to file is now 5 months. To apply for an automatic extension of time to file, use Form 7004, Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns.
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The estate and trust deduction for sales taxes, set to expire at the end of 2007, was extended through December 31, 2009, by the Emergency Economic Stabilization Act of 2008.
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The IRS is expected to release final regulations regarding costs paid to an investment advisor by a nongrantor trust or estate as generally being subject to the 2-percent floor for miscellaneous itemized deductions (line 15b). Additionally, the IRS is expected to address the issue raised when a nongrantor trust or estate pays a Bundled Fiduciary Fee for costs incurred in-house by the fiduciary, some of which are subject to the 2-percent floor. These final Regulations under section 1.67-4 will be consistent with the Supreme Court's holding in Michael J. Knight, Trustee of William L. Rudkin Testamentary Trust v. Commissioner, 552 U.S. __ (2008), Slip Op. 06-1286, 2008 -17 I.R.B. 828. Also, the IRS has announced that the unbundling of fees would not be required for tax years beginning before January 2009.
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For tax years beginning in 2008, the requirement to file a return for a bankruptcy estate applies only if gross income is at least $8,950.
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For 2008, qualified disability trusts can claim an exemption of up to $3,500. A trust with modified adjusted gross income above $159,950 loses part of the exemption deduction. See the instructions for line 20 on page 23 for more details. In addition, the 2008 reduction of the phaseout of the exemption for qualified disability trusts is only ½ the amount of the reduction that otherwise would have applied for 2007.
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Review a copy of the trust instrument (including any amendments) or the will, if any, before preparing an estate's or trust's return.
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Include farm rental income and expenses based on crops or livestock produced by a tenant on line 5 and not on line 6 of Form 1041. Report the income and expenses on Part I of Schedule E (Form 1040).
The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Photographs of missing children selected by the Center may appear in instructions on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.
If you have attempted to deal with an IRS problem unsuccessfully, you should contact the Taxpayer Advocate. The Taxpayer Advocate independently represents the estate's or trust's interests and concerns within the IRS by protecting its rights and resolving problems that have not been fixed through normal channels.
While Taxpayer Advocates cannot change the tax law or make a technical tax decision, they can clear up problems that resulted from previous contacts and ensure that the estate's or trust's case is given a complete and impartial review.
The estate's or trust's assigned personal advocate will listen to its point of view and will work with the estate or trust to address its concerns. The estate or trust can expect the advocate to provide:
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An impartial and independent look at your problem,
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Timely acknowledgment,
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The name and phone number of the individual assigned to its case,
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Updates on progress,
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Timeframes for action,
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Speedy resolution, and
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Courteous service.
When contacting the Taxpayer Advocate, you should provide the following information.
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The estate's or trust's name, address, and employer identification number (EIN).
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The name and telephone number of an authorized contact person and the hours he or she can be reached.
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The type of tax return and year(s) involved.
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A detailed description of the problem.
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Previous attempts to solve the problem and the office that had been contacted.
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A description of the hardship the estate or trust is facing and supporting documentation (if applicable).
You can contact a Taxpayer Advocate as follows:
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Call the Taxpayer Advocate's toll-free number: 1-877-777-4778
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Call, write, or fax the Taxpayer Advocate office in its area (see Pub. 1546, Taxpayer Advocate Service, Your Voice At The IRS, for addresses and phone numbers).
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TTY/TDD help is available by calling 1-800-829-4059.
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Visit the website at www.irs.gov/advocate.
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Download forms, instructions, and publications;
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Order IRS products online;
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Research your tax questions online;
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Search publications online by topic or keyword;
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View Internal Revenue Bulletins (IRBs) published in the last few years; and
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Sign up to receive local and national tax news by email.
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Current-year forms, instructions, and publications.
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Prior-year forms, instructions, and publications.
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Tax Map: an electronic research tool and finding aid.
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Tax Law frequently asked questions.
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Tax Topics from the IRS telephone response system.
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Internal Revenue Code - Title 26.
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Fill-in, print, and save features for most tax forms.
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Internal Revenue Bulletins.
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Toll-free and email technical support.
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