Instructions For Form 5227 (Page 2 of 8) in pdf

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Form 8870, Information Return for

Federal Express (FedEx): FedEx

Address

Transfers Associated With Certain

Priority Overnight, FedEx Standard

Include the suite, room, or other unit

Personal Benefit Contracts.

Overnight, FedEx 2 Day, FedEx

number after the street address.

You can order forms and publications

International Priority, and FedEx

If the postal service does not deliver

24 hours a day, 7 days a week, by calling

International First.

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mail to the street address and the trustee

1-800-TAX-FORM (1-800-829-3676). You

United Parcel Service (UPS): UPS Next

has a P.O. box, show the box number

can also get most forms and publications

Day Air, UPS Next Day Air Saver, UPS

instead.

at your local IRS office.

2nd Day Air, UPS 2nd Day Air A.M., UPS

Worldwide Express Plus, and UPS

A. Employer Identification

Period To Be Covered by

Worldwide Express.

Number (EIN)

The private delivery service can tell

Return

Every trust must have an employer

you how to get written proof of the mailing

identification number (EIN). To apply for

date.

File Form 5227 for each calendar year.

one, use Form SS-4. You may get this

This revision of the form is for the 2002

form from the IRS or the Social Security

Trust Instrument

calendar year.

Administration. Form SS-4 contains

When you file the first return for a

instructions on how to obtain a number

Accounting Methods

charitable remainder annuity trust or

immediately by telephone. If applying by

unitrust, include:

Trust income must be computed using the

mail, send in the Form SS-4 at least 4 to

method of accounting regularly used in

1. A copy of the trust instrument and

5 weeks before you need the number.

keeping the trust’s books and records.

2. A written declaration under

B. Type of Entity

Generally, permissible methods include

penalties of perjury that it is a true and

the cash method, the accrual method, or

complete copy.

Charitable lead trust. This is a trust that

any other method authorized by the

pays a fixed annuity or unitrust amount to

For sample forms of trusts that meet

Internal Revenue Code. The method used

a charitable organization for a fixed

the requirements of a charitable

must clearly reflect income.

number of years. Upon termination of the

remainder unitrust, see Rev. Proc.

payments, the remainder interest is

Unless otherwise allowed by law, the

89-20, 1989-1 C.B. 841, Rev. Proc.

transferred to a noncharitable beneficiary.

trust may not change the accounting

90-30, 1990-1 C.B. 534, and Rev. Proc.

method used to report income (for income

Charitable remainder annuity trust.

90-31, 1990-1 C.B. 539.

as a whole or for any material item)

This is a trust under section 664(d)(1) that

For sample forms of a trust that meet

without first getting consent on Form

pays a fixed dollar amount (not less than

the requirements of a charitable

3115, Application for Change in

5% but not more than 50% of the initial

remainder annuity trust, see Rev. Proc.

Accounting Method. See Pub. 538,

net fair market value of all property placed

89-21, 1989-1 C.B. 842, and Rev. Proc.

Accounting Periods and Methods, for

in trust), at least annually, to one or more

90-32, 1990-1 C.B. 546.

more details.

beneficiaries, at least one of which is not

a charitable organization, for life, or for a

Rounding Off to Whole

When To File

specified number of years (not to exceed

Dollars

20). Upon termination of the payments,

File Form 5227 for calendar year 2002 on

the remainder interest (valued at 10% or

You may show the money items on the

or before April 15, 2003.

more) is transferred to a charitable

return and accompanying schedules as

organization described in section 170(c),

Extension of Time To File

whole-dollar amounts. To do so, drop

or qualified employer securities are

amounts less than 50 cents and increase

Use Form 8868 to request an automatic

transferred to an employee stock

any amounts from 50 to 99 cents to the

3-month extension of time to file. The

ownership plan.

next dollar.

request for an automatic extension must

Charitable remainder unitrust. This is a

be filed by the due date of the return.

Attachments

trust under section 664(d)(2) similar to a

After receiving an automatic 3-month

charitable remainder annuity trust, except

extension, you can also use Form 8868 to

If you need more space, attach separate

that it pays, at least annually, a fixed

apply for an additional (not automatic)

sheets showing the same information in

percentage (not less than 5% but not

3-month extension. The request for an

the same order as on the printed form.

more than 50%) of the net fair market

additional 3-month extension must be

Show the totals on the printed form.

value of the trust’s assets.

filed by the extended due date of the

Enter the trust’s name and employer

return.

Pooled income fund. This is a trust

identification number on each sheet. Also,

under section 642(c)(5) created and

use sheets that are the same size as the

Where To File

maintained by a charitable organization

forms and indicate clearly the line of the

described in section 170(b)(1)(A)(i)-(vi).

printed form to which the information

File all Forms 5227 at the following

Donors to the fund receive a lifetime

relates.

address:

income interest and the charitable

Internal Revenue Service Center

organization receives the remainder

Ogden, UT 84201-0027

interest.

Specific Instructions

Private delivery services (PDSs). In

E. Initial Return, Final Return,

addition to the United States mail, exempt

Amended Return; or Change of

organizations can use certain private

Identification Area

Name or Address

delivery services designated by the IRS to

If you received a Form 5227 from the IRS

meet the “timely mailing as timely filing/

Initial return. Check this box if this is the

with a peel-off label, attach the label to

paying” rule for tax returns and payments.

initial return for the split-interest trust and

the name and address area of the return.

The most recent list of designated PDSs

enter the date that the entity was created.

If the name or address on the label is

was published by the IRS in September

wrong, draw a line through the incorrect

Final return. Check this box if this is a

2002. This list includes only the following:

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portion and enter the correct information.

final return because the trust has

Airborne Express (Airborne): Overnight

terminated. Also, check the “Final K-1”

Air Express Service, Next Afternoon

If you did not receive a peel-off label,

box at the top of the Schedule K-1 (Form

Service, Second Day Service.

complete the information called for at the

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1041).

DHL Worldwide Express (DHL): DHL

top of the form as it appears on Form

“Same Day” Service, DHL USA

SS-4, Application for Employer

Amended return. If you are filing an

Overnight.

Identification Number.

amended 2002 Form 5227, check the

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Instructions For Form 5227 Page 2

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