2006 Instructions For The Wisconsin Fiduciary Return Form 2 And Schedules Cc, Wd, And 2k-1 (Page 4 of 18) in pdf

Information Publications Available Following is a list of some

• Section 645 election – allows a qualified revocable trust to

of the department publications. These publications provide

be treated and taxed as part of the related estate during the

detailed information relating to specific areas of Wisconsin tax

election period. If the election is made for federal income tax

law. They are available at any department office.

purposes, it also applies for Wisconsin. Enclose a copy of

federal Form 8855 or letter making the election.

Number and Title

• Decedent’s estate – a taxable entity separate from a decedent.

102

Wisconsin Tax Treatment of Tax-Option (S) Corpora-

It generally continues to exist until the final distribution of the

tions and Their Shareholders

assets is made to the beneficiaries. A fiduciary administers

103

Reporting Capital Gains and Losses for Wisconsin

the decedent’s assets and reports income earned during

administration and income in respect of the decedent (IRD).

111

How to Get a Private Letter Ruling

• Bankruptcy estate – a separate and distinct taxable entity

114

Wisconsin Taxpayer Bill of Rights

created when an individual debtor files for bankruptcy under

117

Guide to Wisconsin Information Returns

Chapter 7 or 11 of Title 11 of the United States Code.

120

Net Operating Losses for Individuals, Estates, and

Special Conditions Certain estates and trusts have to

Trusts

enter information in the Special Conditions section. See the note

125

Credit for Tax Paid to Another State

under “Requesting a Closing Certificate” on page 3 and “Period

503

Wisconsin Farmland Preservation Credit

Covered” on this page for information on when to complete this

section. If more than one special condition applies, fill in “99” in

600

Wisconsin Taxation of Lottery Winnings

the Special Conditions box.

601

Wisconsin Taxation of Pari-Mutuel Wager Winnings

Rounding Off to Whole Dollars The form has preprinted zeros

in the place used to enter cents. All amounts filled in the form

should be rounded to the nearest dollar. To do so, drop amounts

LINE INSTRUCTIONS

under 50¢ and increase amounts from 50¢ to 99¢ to the next

whole dollar. For example, $129.39 becomes $129 and $236.50

becomes $237.

Follow these line instructions to complete Form 2. Prepare one

copy for your records and another copy to be filed with the

Round off all amounts. But if you have to add two or more

Department of Revenue.

amounts to figure the amount to fill in on a line, include cents

when adding and only round off the total.

Use black ink to complete the copy of Form 2 that you submit to

the department. Do not use pencil or red ink. If completing the

Accounting Periods and Methods Use the same accounting

form by hand, do not use commas or dollar signs when filling in

period and method of accounting that are used for federal

amounts.

income tax purposes. If the federal taxable year or method of

accounting is changed, such change also applies for Wisconsin.

Period Covered File the 2006 return for calendar year 2006

Separate permission to effect such change for Wisconsin is not

and fiscal years that begin in 2006. For a fiscal year, a 52-53

required. However, enclose a copy of the federal document

week period, or a short-period return, fill in the taxable year

authorizing the change with the Wisconsin fiduciary return.

beginning and ending dates in the taxable year space at the top

of the form. If your return is for a fiscal year, a 52-53 week period,

Definitions Applicable to Fiduciaries Under Wisconsin income

or a short-period, also fill in “11” in the Special Conditions box

tax law, federal taxable income is used as a starting point in the

located above the closing certificate information section on

computation of fiduciary income subject to the Wisconsin income

page 1 of Form 2.

tax. Therefore, most terms have the same meaning under

Wisconsin law as in the Internal Revenue Code unless otherwise

Name and Identifying Number Estates use the first line for

noted.

the legal name and decedent’s social security number or, if a

bankruptcy estate, the federal employer identification number

INCOME

(EIN). Trusts use the second line for the legal name and federal

EIN.

Line 1. Federal Taxable Income of Fiduciary Enter the

amount of taxable income of the fiduciary as reported on federal

Type of Estate or Trust Check one of the boxes to indicate the

Form 1041, line 22.

type of estate or trust.

• Inter vivos trust - a trust created during a grantor’s lifetime.

Exceptions

• Testamentary trust - a trust created by a decedent’s will that

• Qualified funeral trusts – Enter the amount from federal

comes into existence at the death of the decedent.

Form 1041-QFT, line 12.

• Electing small business trust (ESBT) – a trust that has income

• Electing small business trusts – If the ESBT consists entirely

from one or more S corporations. The portion of an ESBT

of stock in one or more S corporations, enter zero on line 1.

that consists of stock of one or more S corporations is treated

Line 2. Additions Enter the total of the nondistributable

as a separate trust. If the ESBT box is checked, see the

additions from Schedule A, column 2, line 6. See the Schedule A

“Exceptions” in the instructions for lines 1 and 6a.

instructions on pages 8 and 10.

• Qualified funeral trust (QFT) – if a trust elects to be taxed as

a QFT for federal income tax purposes, the election also

Line 4. Subtractions Enter the total of the nondistributable

applies for Wisconsin. If the QFT box is checked, see the

subtractions from Schedule A, column 2, line 12. Enter as a

“Exceptions” in the instructions for lines 1 and 6a.

positive amount. See the Schedule A instructions on page 9.

2006 Instructions For The Wisconsin Fiduciary Return Form 2 And Schedules Cc, Wd, And 2k-1 Page 4

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