Instructions For Form Ia 1041 - Iowa Fiduciary Return - 2013
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2Iowa Fiduciary Instructions for 2013
General Instructions
Which Return to File
Penalty for Failure to Timely Pay the Tax Due
An Iowa fiduciary return must be filed for estates, trusts, and other entities
A penalty of 5% will be added to the tax due if the return was filed timely
that are taxed as trusts for federal income tax purposes.
but at least 90% of the correct tax is not paid by the due date. The penalty
can only be waived under limited circumstances.
An Iowa individual income tax return must be filed for:
Where the failure to file penalty and the failure to pay penalty are applicable,
The decedent, if the income during the tax period ending with
the failure to file penalty will take precedence.
death meets the Iowa resident or nonresident filing
Federal Tax Audits
requirements. Note: This return must be prepared with the
The Department has six months to make a determination of the correct tax
same method of accounting last used by the decedent.
after receipt of sufficient written notice of the final disposition of any matter
Wards in guardianships or conservatorships.
between the taxpayer and the Internal Revenue Service. A copy of the
Resident and nonresident beneficiaries of estates or trusts, if
federal document showing the final disposition of federal adjustments must
the minimum filing requirements are met.
be attached to the notice in order to begin the 6-month period.
Required Documents to be filed with the IA 1041 Iowa
To constitute notice “sufficient to inform the Department” the notice must
Fiduciary Return
be in writing, supplied under separate cover and not as a part of the return
A copy of the federal fiduciary 1041 return and appropriate
for the current period, and have the federal documents previously mentioned
schedules must accompany each fiduciary return filed.
attached.
A copy of the decedent’s will must accompany the initial
Distributions
fiduciary return if the Department has not previously received
A distribution of property-in-kind to a beneficiary entitled to the income
a copy for inheritance tax purposes.
made after June 1, 1984, in taxable years ending after that date is subject
A copy of inter vivos trust instruments must be filed with the
to an election by the fiduciary to recognize any gain or loss in the estate or
initial return for the trust.
trust. The election is an affirmative act and failure to indicate whether or
If the will has been filed in Iowa probate proceedings, then
not the election is made will be construed as an election by the fiduciary
this instrument is not required to be filed with the initial
not to recognize any gain or loss on the distribution. The election applies to
return of testamentary trusts.
all distributions made during the taxable year.
If the probate inventory has not been filed in Iowa probate
proceedings at the time the initial fiduciary return is filed, a
Return Instructions
statement should accompany the return advising when the
The following instructions are for completing the Iowa fiduciary return.
inventory will be filed.
Detailed instructions are provided for lines requiring special attention.
A probate inventory for a foreign estate should be filed with
Return Identification
the return if an ancillary administration has not been opened
Enter the beginning and ending dates if the return is for a fiscal year. Also
in Iowa.
enter the FEIN and the decedent’s SSN if applicable.
Note: The final fiduciary return serves as an application for a
Income (Lines 1-9)
certificate of acquittance. You must check the boxes on the front of
All income from the probate property owned by the decedent must be
the return requesting an income tax certificate of acquittance and
reported until the property is sold or distributed, or disposition of the property
indicating whether an IA 706 will be filed. If no IA 706 will be
is made. Income derived from probate property should also be reported if
filed, please send a copy of the probate inventory or listing of
the income is deposited in an estate bank account and expenses relating to
assets to expedite processing.
the probate property are paid from estate funds and controlled by the
Also Note: Expenses of administration, executors’ commissions,
fiduciary. The income derived from non-probate property must be reported
attorney fees, etc., are not allowable as an income tax deduction on
on the beneficiaries’ individual income tax returns.
form IA 1041 if they were allowed as a deduction in computing the
Line 1. Taxable Interest Income. Although exempt from federal tax,
taxable estate for federal estate tax purposes.
interest on state and municipal securities is taxable to Iowa with the following
Preparer’s ID Number
exceptions:
Enter the preparer’s SSN, FEIN, or PTIN.
Iowa Board of Regents Bonds
When to File
Iowa Municipality Urban Renewal Bonds
The return with payment is due within four calendar months after the
Low Income Housing Bonds
end of the taxable year. A fiduciary return must be filed for every
Warehouse Project Revenue Bonds
Sewage Treatment Works Revenue Bonds
accounting period in which there is taxable income of $600 or more
Beginning Farmer Loan Program Bonds
and for the final accounting period regardless of income.
Underground Storage Tank Fund Revenue Bonds
Where to File
Soil Conservation District Bonds
Aviation Authority Bonds
Mail the fiduciary return to:
E911 Emergency Telephone Service Program Bonds
Fiduciary Return Processing, Iowa Department of Revenue, P.O. Box
County Health Center Bonds
10467, Des Moines, Iowa 50306-0467
Iowa Rural Water District Revenue Bonds
Quad Cities Interstate Metropolitan Authority Bonds
Prison Infrastructure Revenue Bonds
PENALTY
Iowa Utilities Board and Consumer Advocate Building Bonds
Penalty for Failure to Timely File a Return
Honey Creek Premier Destination Park Tax-Exempt Bonds
A penalty of 10% will be added to the tax due for failure to timely file a
Appropriation Bonds
return if the return is not remitted by the due date and at least 90% of the
correct tax is not paid by the due date. The penalty can only be waived
under limited circumstances.
63-002a (07/08/13)
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