Instructions For Form 541 - California Fiduciary Income Tax Return

Tax Credits

Other Taxes

• Net operating loss deduction or disaster

loss carryover reported on form(s)

Line 22 – Exemption credit

Line 26 – Alternative minimum tax (AMT)

FTB 3805D, FTB 3805V, FTB 3805Z,

An estate is allowed an exemption credit of $10.

If certain types of deductions, exclusions, and

FTB 3807, or FTB 3809

A trust is allowed an exemption credit of $1.

credits are claimed, the estate or trust may be

Yes Complete Schedule P (541).

A qualified disability trust is allowed an exemption

subject to California’s AMT. Get Schedule P (541)

No Complete the Credit Limitation

credit of $106.

to figure the amount of tax to enter on line 26

Worksheet that follows.

for trusts with either resident or non-resident

If a final distribution of assets was made during

trustees and beneficiaries.

the year, all taxable income of the estate or

Credit Limitation Worksheet

trust must be entered on line 18 as distributed

Schedule P (541) must be completed regardless

to beneficiaries, and no exemption credit is

A Enter the total amount from

of whether the estate or trust is subject to AMT if

allowable.

Form 541, line 21 . . . . . . . . . . . . . A ______

an income distribution deduction is reported on

B Enter personal and real property

line 18.

Line 23 – Credits

taxes paid. This includes any

Various California tax credits are available to

Tax and Payments

state and local personal property

reduce the tax. For most credits, a separate

and state, local, or foreign real

schedule or statement must be completed and

Line 27 – Mental Health Services Tax

attached to Form 541. See the credit chart on

property taxes on Form 541,

If the estate’s or trust’s taxable income is more

page 14 for a list of the credits, their codes, and a

line 11 . . . . . . . . . . . . . . . . . . . . . B ______

than $1,000,000, compute the Mental Health

brief description of each.

C Enter miscellaneous itemized

Services Tax. All taxable income from an Electing

Small Business Trust (ESBT) is subject to the

deductions from Form 541,

How to claim California tax credits:

Mental Health Services Tax. Do not calculate

line 15b . . . . . . . . . . . . . . . . . . . . C ______

1. Figure the amount of each credit using the

Mental Health Services Tax on a Qualified

D Add line B and line C . . . . . . . . . . D ______

appropriate form.

Settlement Fund.

E Enter any refund of personal

2. Use the Credit Limitation Worksheet to

or real property tax. Do not

Mental Health Services Tax Worksheet

determine if the credits are limited. Complete

enter the amount of state

Use whole dollars only.

the worksheet unless federal Schedules C, E,

income tax refund . . . . . . . . . . . . E ______

or F (Form 1040), and/or federal Schedule D

A. Taxable income from

F Subtract line E from line D . . . . . . F ______

(Form 1041) were not completed and the

Form 541, line 20a . . . . . . .

G Enter the amount from Form 541,

amount entered on Form 541, line 17, is less

B. ESBT Taxable Income,

line 20a . . . . . . . . . . . . . . . . . . . . . G ______

than $42,319.

line 20b. . . . . . . . . . . . . . . .

H Add line F and line G . . . . . . . . . . . H ______

a) If federal Schedules C, D, E, or F (Form 1040)

Enter $42,319 . . . . . . . . . . . . . . . . I ______

C. Add line A and line B. . . . . .

or federal Schedule D (Form 1041) were not

J Subtract line I from line H. If

D. Less . . . . . . . . . . . . . . . . . .

($1,000,000)

completed and the amount entered on Form

zero or less, enter -0- . . . . . . . . . . J ______

541, line 17, is less than $42,319, do not

E. Subtotal . . . . . . . . . . . . . . .

K Multiply line J by .07 . . . . . . . . . . K ______

complete the credit limitation worksheet. The

F. Multiply line E by 1% . . . . .

x .01

L Subtract line K from line A. If

credits are not limited.

less than zero, enter -0- . . . . . . . . L ______

G. Mental Health Services

b) If the estate or trust completed federal

M Enter the total credits . . . . . . . . . . M ______

Tax – Enter this amount on

Schedule C, E, or F (Form 1040) or federal

Form 541, line 27 . . . . . . . .

Schedule D (Form 1041) and claimed or

received any of the following:

If line L is more than line M, the estate’s or trust’s

Line 29 – California income tax withheld

credits are not limited. Go to “Claiming Credits on

• Accelerated depreciation in excess of

Attach federal Form(s) W-2 if the fiduciary

Form 541,” below.

straight-line

claims credit for California income tax withheld

• Intangible drilling costs

If line L is less than line M, get and complete

on a decedent’s wages and salaries received

• Depletion

by the fiduciary. Do not include withholding

Schedule P (541).

• Circulation expenditures

from Forms 592-B or 593 or nonconsenting

Claiming Credits on Form 541

nonresident (NCNR) member’s tax from

• Research and experimental expenditures

If the conditions above do not apply, do not

Schedule K-1 (568), line 15e on this line.

• Mining exploration/development costs

complete Schedule P (541).

• Amortization of pollution control facilities

Line 30 – California income tax previously paid

Each credit is identified by a code. If the estate or

• Income/loss from tax shelter farm activities

(minus tax allocated to beneficiaries)

trust claims one credit, enter the credit code and

• Income/loss from passive activities

Use this line only if the estate or trust is filing an

amount of the credit on line 23.

• Income from long-term contracts using

amended tax return. Enter payments made with the

If the estate or trust claims more than one credit,

the percentage-of-completion method

original tax return plus additional tax paid after the

use Schedule P (541), Part IV, Credits that Reduce

• California qualified stock options (CQSOs)

original tax return was filed. If the estate or trust

Tax, to figure the total credit amount. Total the

made only one payment, enter the serial number

Yes Complete Schedule P (541).

column B amounts from Lines 4 through 10

that the FTB stamped on the face of the cancelled

No Go to item (c).

and Lines 12 through 16, of Schedule P (541),

check if available, on the dotted line to the left of

Part IV, and enter on Form 541, Line 23. Attach

c) If the estate or trust claimed or received any

the amount on line 30. If the estate or trust made

Schedule P (541) and any required supporting

of the following:

multiple payments, did not receive a cancelled

schedules or statements to Form 541.

check, or made any payment with a credit card,

• AMT adjustment from another estate or

If the estate or trust claims a credit with carryover

attach a statement showing the check number, the

trust

provisions and the amount of the credit available

amount of the check or charge, the date posted to

• Investment interest expense

this year exceeds the estate’s or trust’s tax, carry

the account, and the name of the payee FTB.

• Income from incentive stock options

over any excess credit to subsequent years until

Be sure to reduce the amount of tax previously

in excess of the amount reported on

the credit is used.

paid by the amount of estimated tax that the

Form 540 or Form 540NR (Long or Short)

If the estate or trust claims a credit carryover

beneficiary treated as a payment.

• Charitable contribution deduction for

for a repealed credit, use form FTB 3540, Credit

appreciated property

Line 31 – 2013 Withholding (Form 592-B

Carryover and Recapture Summary, to figure this

• Income from installment sales of certain

and/or Form 593)

credit, unless the estate or trust is required to

property

Enter the total California tax withheld from the

complete Schedule P (541). In that case, enter

estate’s or trust’s Form 592-B and/or Form 593.

the amount of the credit on Schedule P (541),

Attach a copy of Form 592-B or Form 593 to the

Sections A2 and B1 and do not attach form

lower front of Form 541, Side 1.

FTB 3540.

Form 541 Booklet 2013 Page 9

Instructions For Form 541 - California Fiduciary Income Tax Return - 2013 Page 8

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