Instructions For 2003 Vermont Fiduciary Return Of Income
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3GENERAL INFORMATION
a business operation in Vermont; 2) for goodwill
associated with the sale of a Vermont business; or
WHO MUST FILE A 2003 VERMONT FIDUCIARY
3) for contractual services associated with the sale
RETURN OF INCOME?
of a Vermont business, unless it is shown that the
Use Vermont Fiduciary Form FI-161 for trusts, estates, and
compensation for services does not constitute
qualified settlement funds. Use Vermont Income Tax Form
income from the sale of the business;
IN-111 to report income of a decedent from the beginning
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Income previously deferred under a non-qualified
of the tax year to the date of death.
deferred compensation plan and income derived
A Vermont Fiduciary Return of Income must be filed for
from such previously deferred income.
every estate and trust required to file a U.S. Income Tax
Vermont Income of Part-Year Resident Estate or Trust
Return for Estates and Trusts and that earned or received
means all items of income which are earned or received
more than $100.00 of Vermont income OR received more
during the period of Vermont residency and any income
than $1,000.00 in gross income from the sources listed under
described in Vermont Portion (see Schedule E) for a
Vermont Portion (see Schedule E).
nonresident or part-year resident estate or trust.
A Vermont Fiduciary Tax Return must be filed for any
EXTENSIONS TO FILE RETURNS - In order to obtain
Section 468B Designated and Qualified Settlement Funds
an extension of time in which to file a return, either a copy
required to file a Federal Form 1120-SF that earned or
of the Federal application for extension of time to file or a
received more than $100.00 of Vermont income OR that
letter requesting an extension of time must be submitted to
earned or received more than $1,000.00 in gross income from
the Vermont Department of Taxes prior to the due date of
the sources listed under Vermont Portion (see Schedule E).
the VT return. Remember: An extension of time to file
A Vermont Fiduciary Tax Return must also be filed for an
the return does not extend the time to pay the tax due. All
Electing Small Business Trust required to file a Federal 1041.
tax calculated to be owed should be paid with the extension
If you have any questions, contact the Vermont Department
request.
of Taxes at (802) 828-2548.
LATE FILED RETURNS - Returns without an extension
Dividends - Dividends are considered ordinary income for
of time that are filed more than 60 days after the due date
Vermont tax purposes. The capital gains treatment of
are assessed a $50.00 late filing fee. Returns under extension
dividend income for Federal income tax is not available for
are assessed the $50.00 late filing fee if filed after the
Vermont income tax.
extended date.
A trust is a Vermont trust if the settlor was a Vermont resident
TAX DUE - Returns with tax due and which are filed after
when the trust became irrevocable or if the trust is still
the due date are assessed interest and penalty on the
revocable and the settlor was a Vermont resident when the
outstanding amount. Interest and penalty starts from due
trust was created. Also, a trust is a Vermont trust if the
date until the date of payment. Interest is 0.5% per month.
settlor was domiciled in Vermont at his/her death.
Penalty accrues at 2% per month, up to 25% of the unpaid
Resident estate means the estate of a decedent who, at his/
tax.
her death, was domiciled in this state.
CHANGES IN FEDERAL INCOME TAX LIABILITY
VERMONT INCOME DEFINITIONS
If, after the Vermont Fiduciary Return of Income is filed,
Vermont Income of a Resident Estate or Trust is the
the Federal income tax liability is adjusted or the Federal
adjusted gross income less income exempted from state
refund amount is different than expected, an Amended
taxation under the laws of the United States.
Vermont Fiduciary form must be filed with the Department
within 30 days of the notice from IRS. For 2002 & 2003,
Vermont Income of a Nonresident Estate or Trust is the
this process can be accomplished by checking the Amended
sum of the following items, to the extent the items are
box in the taxpayer information section. Enter the correct
required to be included in Federal adjusted gross income:
figures as if this were the original filing. For prior years,
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Rents and royalties from property located in
mark the VERMONT FIDUCIARY RETURN OF
Vermont;
INCOME with the word "AMENDED". Attach a copy
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Gains from the sale or exchange of Vermont
of all Federal forms showing the change. Failure to file
property including the sale of timber or timber
these forms may result in a refund being denied or an
rights;
assessment of late fees, interest and penalty as well as an
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Wages, salaries, commissions or other income
additional Vermont tax liability. It is the responsibility of
received for services performed in Vermont;
the administrator, executor, personal representative, or
trustees to file an amended return with Vermont within the
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Income from every business, trade, profession or
30-day period. The IRS and Vermont routinely share
occupation conducted in Vermont, including money
information. Differences in the information filed with IRS
received 1) under an agreement not to compete with
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