Instructions For Form 8960 (2015) (Page 20 of 20) in pdf

Form 1041, Schedule A can be

allow us to figure and collect the right

Line 19a—Adjusted Gross Income

used as a worksheet to calculate

amount of tax.

(AGI)

TIP

the amounts of net investment

You are not required to provide the

If the estate or trust does not own a CFC

income allocable to charitable distributions

information requested on a form that is

or PFIC, enter its AGI for regular income

by including on line 2 both tax-exempt

subject to the Paperwork Reduction Act

tax purposes. See the instructions for

income and the difference between

unless the form displays a valid OMB

Form 1041, line 15c and Form 1041-QFT,

adjusted total income and the trust's net

control number. Books or records relating

line 10.

investment income (Form 8960, line 18a).

to a form or its instructions must be

retained as long as their contents may

The amount of the deduction for

If the estate or trust owns a CFC or

become material in the administration of

net investment income distributed

PFIC, it may need to make adjustments.

TIP

any Internal Revenue law. Generally, tax

to beneficiaries should equal the

See

Line 13—Modified Adjusted Gross

returns and return information are

sum of net investment income reported to

Income

(MAGI), earlier.

confidential, as required by section 6103.

the beneficiaries on their respective

Schedules K-1 (Form 1041).

The time needed to complete and file

Line 19b—Highest Tax Bracket for

this form will vary depending on individual

Estates and Trusts

circumstances. The estimated average

Note. In general, the deduction for

See the instructions for Form 1041,

time is:

distributions of net investment income

Schedule G, line 1a and the instructions

may not exceed the taxable income

for Form 1041-QFT, line 13 for the dollar

distributed to the beneficiary for regular

Recordkeeping

1 hr., 1 min.

. . . .

amount at which the highest tax bracket

income tax purposes. However, in the

Learning about

begins for the tax year and enter that

case of an estate or trust that owns an

the law or the

amount here.

interest in certain CFCs or PFICs, the

form

6 hr., 4 min.

distribution of net investment income can

. . . . . . . . . . . .

exceed the distribution of taxable income

In the case of a QFT, see

Special

Preparing the

computational rules for qualified funeral

when the amount of distributions exceed

form

1 hr., 47 min.

. . . . . . . . . . . .

trusts

(QFTs), earlier, to determine the

distributable net income for regular

Copying, assembling,

amount to report on Form 8960, line 19b.

income tax purposes.

and sending the form

to the IRS

20 min.

Form 1041, Schedule B can be

. . . . . . . .

Line 21—Net Investment Income

used as a worksheet to calculate

TIP

Tax for Estates and Trusts

the income distribution deduction

for NIIT purposes by replacing line 1 with

You can send us comments by going to

Form 1041 filers: Include this amount

the trust's net investment income (Form

, clicking on “More

on Form 1041, Schedule G, line 4, and

8960, line 18a) and including on line 2

Information,” and then clicking on “Give us

see the instructions there.

both adjusted tax-exempt interest and the

feedback.” You can also send your

Form 1041-QFT filers: Include this

difference between line 1 and the trust's

comments to the Internal Revenue

amount on Form 1041-QFT, line 16, and

net investment income (Form 8960,

Service, Tax Forms and Publications

see the instructions there.

line 18a).

Division, 1111 Constitution Ave. NW,

IR-6526, Washington, DC 20224. DO

Paperwork Reduction Act Notice. We

NOT SEND THE FORM TO THIS

ask for the information on this form to carry

Line 18c—Undistributed Net

ADDRESS. Instead, include this form with

out the Internal Revenue laws of the

Investment Income

your return, filing it according to the

United States. You are required to give us

Do not enter a negative number. If

instructions for your return.

the information. We need it to ensure that

negative, enter zero.

you are complying with these laws and to

Instructions for Form 8960 (2015)

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Instructions For Form 8960 (2015) Page 20

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