Form Fi-161 - Vermont Fiduciary Return Of Income

difference between depreciation using standard MACRS on assets

GENERAL INFORMATION

qualified for 2012 Federal bonus depreciation and the reported

WHO MUST FILE A 2012 VT FIDUCIARY RETURN OF

Federal depreciation on those qualified assets as a result of VT

INCOME (Form FI-161)?

disallowance of the bonus depreciation; state and local income

A VT Fiduciary Return of Income must be filed for every estate

taxes deduction on Form 1041, Line11 in excess of $5,000 with

and trust required to file a U.S. Income Tax Return for Estates and

(2) the subtraction of interest income from U.S. government

Trusts and that earned or received more than $100 of VT income

obligations to the extent such income is included in Federal

OR received $1,000 or more in gross income from the sources

adjusted gross income; capital gains exclusion; and as a result

listed under VT Portion on Schedule E.

of VT disallowance of the bonus depreciation, the difference

A VT Fiduciary Tax Return must be filed for any Section 468B

between depreciation using standard MACRS on assets qualified

Designated and Qualified Settlement Funds required to file a

for prior year Federal bonus depreciation and the reported Federal

Federal Form 1120-SF that earned or received more than $100 of

depreciation on those qualified assets.

VT income OR that earned or received $1,000 or more in gross

VT Trust A trust is a VT trust if the settlor was a VT resident when

income from the sources listed under VT Portion on Schedule E.

the trust became irrevocable; or, if the trust is still revocable and

A VT Fiduciary Tax Return must also be filed for an Electing Small

the settlor was a VT resident when the trust was created. Also, a

Business Trust required to file a Federal 1041.

trust is a VT trust if the settlor was domiciled in VT at his/her death.

A VT Fiduciary Tax Return filer may be entitled to certain State

EXTENSION TO FILE THE VT FIDUCIARY TAX RETURN

incentives or credits.

To receive a five-month extension of time to file the fiduciary

tax return, file a copy of the Federal extension request or a letter

If you have any questions, contact the VT Department of Taxes

requesting an extension of time on or before the due date. NOTE:

at (802) 828-6820.

An extension of time to file the Vermont Fiduciary Tax Return does

NOTE: Use VT Income Tax Form IN-111, not this form, to report

not extend the due date for the tax payment. Interest and penalty

income of a decedent from the beginning of the tax year to the

accrue on any tax owed from the due date to receipt of payment.

date of death.

LATE-FILED RETURNS - Returns without an extension of

time may be filed up to 60 days after the due date without a late

DEFINITIONS

file penalty charge. Returns without an extension filed on the

Resident Estate means the estate of a decedent who was domiciled

61st day after the due date or later will be charged a $50 late file

in Vermont at the time of death.

penalty. Returns with an extension filed on or before the extended

VT Income of a Resident Estate or Trust means the adjusted

due date are not charged a late file penalty. However, returns with

gross income of a resident less income exempted from state

an extension filed one or more days after the extended due date

taxation under the laws of the United States.

are charged a $50 late file penalty. NOTE: The late file penalty

VT Income of a Nonresident Estate or Trust means the sum

applies even if the return results in a refund or no tax due.

of the following items, to the extent the items are required to be

TAX DUE - Returns with tax due that are filed after the due date are

included in Federal adjusted gross income:

assessed interest and late payment penalty charges on the unpaid

•

Rents and royalties from ownership of property located

tax. Interest and penalty accrues from the due date until the date

in VT

paid. Interest is 0.4% per month. Penalty is 1% per month or

•

Gains from the sale or exchange of VT property including

portion of month, up to 25% of the unpaid tax.

the sale of timber or timber rights

AMENDING OR CORRECTING VT FIDUCIARY TAX

•

Wages, salaries, commissions or other income received

RETURN INFORMATION

for services performed in VT

VT law requires an amended VT return be filed within 60 days

•

Income from every business, trade, profession or

of knowledge of the change, or receipt of the notice of change

occupation conducted in VT, including money received

by IRS, or the filing of an amended return with the IRS. A late

(1) under an agreement not to compete with a business

file penalty will be assessed if the amended VT return is not filed

operation in VT, (2) for goodwill associated with the

within the 60 days.

sale of a VT business, or (3) for contractual services

•

Change to VT income An amended return is due even if the

associated with the sale of a VT business, unless it

change is not the result of filing an amended Federal tax return

is shown that the compensation for services does not

or an adjustment made by the Internal Revenue Service; for

constitute income from the sale of the business

example, the amount of income taxable to VT is different from

•

VT income previously deferred under a non-qualified

the amount originally reported. The amended return must be

deferred compensation plan and income derived from

filed within 3 years of the due date of the return, including

such previously deferred income

extensions.

•

Lottery winnings from ticket(s) purchased in VT for VT

•

Change of Federal tax information by IRS If the IRS

Lottery, Tri-State Lottery, PowerBall or Mega Millions.

adjusted the Federal taxable income, capital gains amount

VT Income of Part-Year Resident Estate or Trust means any

or any other change that affects the VT tax, an amended

income described in VT Income of a Nonresident Estate or Trust

VT Fiduciary tax return must be filed within 60 days of

and all items earned or received during the period of VT residency

notification by the IRS, even if this is past the 3-year limit.

described in VT Income of a Resident Estate or Trust.

Attach a copy of all Federal forms showing changes to the

VT Taxable Income means Federal taxable income with (1)

VT amended return. The IRS and VT Department of Taxes

the addition of interest, dividends or other distributions from

routinely share information. Differences in the information on

non-VT state and local obligations to the extent this income is

file with the IRS and the VT Department of Taxes, other than

excluded from Federal adjusted gross income; the capital gain

those allowed by VT law, are identified and may be audited.

deferral in a previous year for investment in a qualified business

•

Filing an Amended Federal tax return Filing an amended

upon disposition of the taxpayer’s interest in the business; the

VT return is required within 60 days of filing an amended

Form Fi-161 - Vermont Fiduciary Return Of Income - 2012 Page 2

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