Name: Intuit ProSeries: Preparing 1041 Trust and 706 Estate Tax Returns
Uploaded: 2025-11-06T21:16:03.651Z
Duration: 1 h 8 s
Description: Intuit ProSeries: Preparing 1041 Trust and 706 Estate Tax Returns

Transcript for "Intuit ProSeries: Preparing 1041 Trust and 706 Estate Tax Returns": Hello, and welcome to the Intuit ProSeries webinar. This is preparing ten forty one trusts and seven zero six estate tax returns. I am Diana Crawford. I am a CPA, and I will be your moderator today to give you some information. I've been a CPA and a ProSeries user or the predecessor going on about party four years. I am consider myself to be a tax strategist, always planning for the future and helping my clients build legacies through forward planning. I served on, Intuit's tax council for a little over five years, and I've been a presenter at various different educational and wellness seminars. And if I weren't here with you, I'd love to be out in the garden or preferably at the beach. A beach at the garden would be great. But we have some things to, talk about today. So let's talk about some housekeeping. Now this webcast does stream exclusively through your computer's speakers, and we recommend using either Chrome or Safari for the best experience. We don't, advocate using VPN or ad blockers or firewalls and incognito mode on your browser. Just doesn't work quite as well. Now as soon as this, webinar concludes, you will get a survey. And as you'll learn throughout the course of this webinar, I am a time junkie. I like to to do things as efficiently as possible, and I consider your time to be very valuable that you've taken to learn, here today. So if you can fill out that, short survey so that we can get some feedback so that if we can improve this in the future, we'd love to have the feedback to be able to do that. Is that so that's pretty greatly appreciated. There we go. So as we go through the polls today, this, webinar is eligible for CPE, and the polls will pop up in the middle of this slide. And then on the right hand side where you see the chat and the q and a, you will see the polls. So you can either answer it from the middle screen, or if it's not in your middle screen, navigate over to polls on the right, click the polls, and you will see how your answer, has been recorded with other individual answers. And, you can know that your poll answer has been recorded. I'll give you a little bit less than a minute to record your poll results before we move on to more content. So please just answer the polls as quickly as you can. Now the information that we're including in today's, webinar is educational in nature and should not be construed as tax advice. While the information is believed to be accurate and is based on the most recent legislation that can change at any time, we don't have an obligation to update you or this webinar, when that authoritative information might be changed. And every client situation is, of course, unique, and you as a tax professional, we want to carefully consider the facts and the circumstances before you apply, the information that we're going over today to your individual client's tax situation. So today's CPE is eligible for one hour of CPE credits and one hour of IRS credits. And there will be interactive polling questions throughout. To also receive the CPE credit, you must answer the polling questions and attend a minimum of fifteen minutes. There will be at least two two polls during today's, webinar. So let's talk about what we're going to cover. So basically, we have three areas that we wanna look at today. We're gonna go in-depth into the ten forty ones, both both the basic input, and beneficiary distributions. We're also gonna talk about grantor trusts and split interest returns. And we're gonna also talk about estate tax returns, the seven zero six returns, how to input that information, how to input that beneficiary information. It's really a lot of content, and I'm not sure that, you know, we've gone over these detailed, types of returns before. So hopefully, we'll be providing some good information for you. So our objectives, is to make sure that you can basically input a ten forty one return, understand the difference between grantor and split interest trust. And then for the seven zero six, be able to do that input. And then also get those k one's, beneficiary information entered so that you can, produce those k ones as well. So right off the bat, it's time for our first poll question. This one's going to be really easy for you to answer. And that is, basically, why did you, choose to attend with us today? I believe your reason for attending might be just to receive free CPE. Maybe it's to explore new solutions. Maybe you're looking to solve a specific problem or you know you have some, seven zero six or $10.41 other charge coming up and you just wanna get a little more information on. Maybe you're just curious and, maybe maybe other. None of the above. So whatever your particular answer is, if you go ahead and answer that in the poll question, remember, you can answer it right on the screen. Or navigate over to the poll on the right hand side, click the poll, and you can answer it there. Just say, choose the box at the bottom to submit your answer once you've selected what your answer is. Give you about ten more seconds, then we're gonna move on, to our content. Okay. So we've gotten, we've gotten to a minute, so I'm gonna go ahead and close the poll. And thank you very much for your answers. Okay. So let's get started on the 10:41. So a lot of the information that I will be discussing today is going to be Vibe and end product. Now know that you can go back and rewatch this webinar later, but you also has have information in this slide deck that goes through some of the basics of what we're going to be talking about. So if you wanna download the documents, you can do that and kind of follow along, make notes, or, like I said, go back and watch it again later. So when you're initially putting in the information on the information worksheet, you wanna put in the federal ID number and you wanna put in the name of the estate or the trust. If you can get the CP 575 that was received from the IRS by the individual that set up, this estate or trust. You wanna get that because it'll give you the name control. And I have gotten, error messages, e filing error messages when my name control does not match what the IRS thinks it should be. So if you can, ask your clients for that five c P575 letter so that you can be sure that that, information is correct. Of course, if this is an ongoing client, it's probably right. But just to to make sure you've got that information. You're gonna put the last name and first name of the executors, put what their title is, and, name, address, phone number. And then also you do wanna put in an email address so that you can use DocuSign or whatever your, esignature, method is, in getting those electronic signatures if possible. So the next thing that you fill out is the tax year and the filing information. And I say that that trusts and and even estates more often than not, have different years than, say, you know, business or certainly individual returns. So you're gonna fill this information in, again, based on that CP five seventy five letter. That's why it's so important to try to get that letter if possible. Now some of your, estates or trusts might have to make estimated tax payments. And if that's the case, you gotta click Zoom right there to that. If you're gonna have K-1s, you're gonna distribute your rounding difference, printing options, and then, of course, the signature at the bottom. And that may very well be the person who's listed on the return as well. Alright. So let's go ahead and jump over to the first page of the return because the first page of the return is a little different than, say, our business returns or our individual returns because it's on the base of the first page of the return where we dictate what kind of return we are preparing. So it could be that we are filing an estate. And if that's the case, you would check this, and then you would put in what that decedent's date of death is. If it's if it's an estate tax return, this is what gets entered here. Then you have information about the date it's created, of course, what the federal ID number is. If this is going to be if the net income is going to be allocated down to beneficiaries, then this would show you how many k ones that you have. So that would be in the case of a decedent's estate. Now let's talk about a complex trust. So a simple trust is is pretty much when a simple trust distributes the current income and the tax responsibility to the beneficiaries every year. So the trust is not gonna be responsible for paying taxes. So you're always going to be distributing. The complex trust, though, it can accumulate income, it can distribute assets, and it can make charitable contributions. Simple trusts don't make charitable contributions. Complex trusts do. So that is the primary difference between a simple trust and a complex trust. So you may need to get this information from the trust document, from the attorney who set up the trust. Maybe the, the executor or the administrator would know. If it's a complex, excuse me, or a simple trust, but you would need to to know this right off because the entire rest of what you're going to fill in for this trust touch return is based on what kind of trust this is. Now you also have qualified disability trusts, the the ESBT, which is the s portion of a trust, and then grantor type trust. So if it's a grantor type of trust, you're going to go here and talk about the amounts to allocate, on the grantor trust. Now what is a grantor trust? Simply, the this is typically when an individual has put their assets in name in legal title name into the trust, but they have retained really significant control and ownership of the assets, of the income, of the expenses, pretty much it's considered a flow through trust. So, everything is treated on the individual's personal tax return for tax purposes, and it's and it's grand tour and revocable until such time as the grand tour passes, and then it reverts to the irrevocable trust. Now you might also have bankruptcy estates, chapter seven and chapter 11, and you could have pooled income funds. So in this one particular, tax return, a ten forty one, you have all of these options. So that's why we have, a good bit of time today to go over what how you how you input this information, how are they different, and and what do you do with that. So as I was mentioning, in a simple trust, what happens is you're gonna report all of the income and expenses, and then that's going to be thrown out to the beneficiaries through k ones. So let me walk through that quickly. And in doing that, also understand that the same information would typically be in a complex trust. It just boils down to who is going to report the income and pay the taxes on it. And as I'm sure you all know, a trust pays taxes typically at a higher rate than individuals would pay taxes. So that's why when the income in the trust can be allocated out to beneficiaries, it might result in a lower tax being paid. Might not, but might. But would always want to give that some consideration if that's a possibility. Okay. So we're gonna skip past this information here because we're we're gonna talk about the simple trust. So, again, you're gonna talk about whether this is initial, amended, changes. Make sure you check all those boxes. And then we get down to the income section. So this, again, first page of the return, you can see here that we've got these interest and dividends and and then what's going to be allocated out to our beneficiaries. So you have an income and dividend worksheet. You can quickly zoom back into there. And for this one, we're looking at our interest income, and we said we had interest income from two, financial institution accounts, and this is the type. And then you also have the ability of saying whether this is tax exempt interest or US government obligation interest. There might be state ID. There might be federal income tax held. There might even be private activity bond interest included, and you would mark that here. Rolling on down, we are looking at our dividend income. So this is very similar to the information that you would enter on a personal tax return where you have your ordinary and qualified dividends, capital gains, unrecaptured section twelve fifty gains, collectibles. You might also have federal tax withheld, section 199a dividends, investment expenses, and, of course, US obligations. So you're gonna put all of this information in because then that information gets like I said, flows back to the the k ones. So here we have the summary, the interest income, the dividend income, and then what dividends are going to be allocated to the beneficiaries. So you're either gonna go up to your forms menu and go to where you have the schedule k one. It's gonna be the k one worksheet. See that right here? We're gonna jump to the k one worksheet, and this is going to show the amounts that are gonna be allocable to our beneficiaries. Okay? So if you wanna go to the schedule k ones, you're gonna click on this. We have three beneficiaries set up here. You're gonna go to the first beneficiary. Now a little bit different here than you would see, like, on the partnership or s corporation return is that there's not a k one, worksheet per se that you put the information for each individual beneficiary on. It's entered directly on the k one. So you have here the first beneficiary. You would put in their federal ID number. You would put in their name, their address, and whether they are domestic or a foreign beneficiary. Now here is the next very important part, and that is what is the amount of this beneficiary's flow through income? So either you're gonna put in the percentage. And if here we have three beneficiaries, we would have to allocate that, amongst the three of them. So do you know that someone will need to have three three point three four to get this spreadsheet to definitively scope out all of the income to one of the individual beneficiaries. So that's that's what you know, just make sure of that because if not, at the end, you're gonna end up with, you know, a small, you know, few dollars possibly, and and it won't be an agreement. You must distribute all of the income or you'll have it here. So then you go to the next beneficiary. You put in all of their information and the same thing. You're gonna put in we'll make this one the three four and go to the third one, and you'll make this one the three three. Looks like I had put, a 50, a 20, and a 30. So sometimes, depending on the trust document, it will say how much the income is to be distributed, and sometimes it's not equal. Sometimes different amounts go to a spouse and children or, all kinds all kinds of of allocations to be made. But the important thing is that you end up with a 100% amongst all of the beneficiaries. So if we go back to page one, we're now showing the qualified dividends that are allocable to the beneficiaries because we have the ordinary dividend dividends. This is talking about the qualified dividends. Same thing if you have a capital loss that is going to flow, forward. You might have farm income. If there is a farm that is managed through this, estate or trust, then you could have businesses. You could have k ones. You'd have a lot of information that flows here. And so this information all gets recorded back on the schedule that it pertains to. And so the information is is filled out about this form, and all of the expenses, just like you would in the other business return, are included. So we're gonna come down here, and that's what we're gonna go through to get to the income for the trust. Then you have the deductions. So you have to break down the deductions between the amounts that are totally allocable to taxable income, then the amounts that are totally allocable to tax exempt income, and then the amounts that are gonna be allocated between the two. And so you'll fill in, and that's things like interest, state and local income taxes, you can see here, real and personal property taxes, fiduciary fees, attorney account, return preparation fees. So all of that information is put here. If there are any additional forms that have to be reported, such as the forty nine fifty two for interest, then you would, put the amount here and check that you're attaching that particular item to this tax return. Fiduciary fees, charitable contract charitable deductions. Now remember, charitable deductions only apply to complex trusts, not to simple trusts. The charitable deductions would have to be, allocated differently or handled differently in the case of a simple trust. A simple trust is where, again, all of the income gets distributed in the year, that it's earned and paid for by all the beneficiaries. So after all of that income is reported on this trust, then it's going to come down to what is the net. You have your total income. You have your total expenses, and then you have your income distribution. So if you're not coming up with the right amount of income to be distributed, click back into, and you can see the trust accounting. So what is going to be deducted or deducted in the return? Nothing on a simple trust. It's all gonna flow through to the beneficiaries. So here you can see what income is going to be distributable to beneficiaries. And this will tie back to what the amount is that's reported on all three of those trust beneficiaries. Alright? So you can see here the trust accounting, a 100% of it is going to the beneficiary. So this, this tax return, there's not going to be any taxable income. And if we go back up, we're just down on page two. We're gonna go back up to the top here. You can see that there is no taxable income. Now in anticipation, if someone had paid in estimated taxes, if there were taxes withheld, which sometimes is the case, then that information will put on here and you get down to possibly an overpayment. But but we're looking at a simple trust and how that all flows down into into the returns. Okay? And gets down to your net tax. Let me go. Alright. Let me take you back over into our slides. So remember, here's the document that we're, discussing. So page one of the return, as I mentioned, fill in all of that information. Simple interest trusts distributed all their current income, and they tax responsibility flows through to the beneficiaries. Complex trusts can accumulate income. They can distribute assets, and they can make charitable contributions. Grantor trusts are where the grantor retains significant control and everything is, still reported based on the individual grantor's tax return. So split interest trusts divide a beneficial interest between the trust's assets and two or more beneficiaries. So it means that some of the assets are kind of held in reserve and some of the assets are distributed out to two or more beneficiaries. So if you weren't familiar with what a split interest trust, it means some of the interest is kept within the trust, if you wanna think about it simply like that. And the other portion of the interest is, is split with two or more beneficiaries. Now charitable remainder trusts and charitable lead trusts are primarily split interest type trusts. So like one of my clients has a charitable remainder trust. So there's some assets that go to the, beneficiaries and then, there's an amount that goes to to charity and then the remainder would go to beneficiaries. And split interest trusts are taxable. So the trust pays the taxes because, obviously, some of it is is going to individuals, and some of it is going to the charity. So it's not that you take part of the income and put it to the beneficiaries. The trust itself pays those taxes. So we talked about the simple trust information that you input and that you wanna make sure that you go down and and show that all of the, trust information, was allocated. And I'm going to go back and show you when we jump back in the program, how to make sure that everything, that has been input in terms of your income is reported, on on the tax return so that you can see how the beneficiary allocation, goes. And and that's my my final check. Okay. Did I allocate all of the income where where it should be? And and it's all on the beneficiary. So I'll go back to that in just a minute. Alright. So when I go back, I'm going to well, let me go to the next slide. This is where we're going next. So this is what we're gonna look at, is the, is the beneficiary distribution. And that's gonna show you the distributable income to the different, beneficiaries. So let's stop our slides and go back in the pro series. Okay. And so you can see here when you've got the distributable income now this is on the simplest state, and my example is on the complex estate. So let me go ahead and take us back there, and let's go change this back to a complex trust. Okay. So then when we go to a complex trust, what we're looking for is how does the different, income get distributed. And so what we want to make sure of is, is it going to the right place? Is it non passive income? Is it passive income? And and is it all being distributed? And so this will sum total all of the different categories and show how much is being distributed to the beneficiaries. So right now, this is saying that it's not being allocated to the beneficiaries. So we have to make sure that it is allocated here in terms of the percentage. Now what happens if you have amounts that are not allocated the same? And that that rarely happens in a trust, but it can happen. And that is, do each of them get the the correct amount? And the answer would be, this is where you're going to go to decide if that is correct. Okay. So in terms of distributable income, this is the income that's gonna flow through to the k ones. And if you scroll down to the bottom of this, you're gonna have the all of the different categories, your interest, your nonqualified dividends. You're gonna have whether it's nonpassive or passive. And then you're gonna have the amounts that are distributed to the beneficiaries. So this is the amount that's going to be on the k ones. So $17.92 is our total. If we looked at at the first beneficiary, about a third of that is gonna be $5.97 on the ordinary dividends again. So you're getting 33% of this amount that's distributable, distributing onto each of the k ones. And that's the goal. Take all the income that's earned and have that distributed to the beneficiaries. So that that pretty much, would get all of the income distributed out. So what happens if the income is not distributed out? What happens if the income is taxed by the trust itself. So then when you come down here, you don't have the income being allocated out. You would have instead you would have a qualified business income deduction. A trust gets that similar to a business or an individual schedule c. You would have an $89.95 attached, and you have a $100 exemption. So then you get down to what is the net taxable income. So in this case, for all of these examples, now I did go back and take out that that the the income's being allocated. Now we're talking about this is a complex trust. And so the beneficiaries aren't paying the taxes. The trust is gonna be paying the taxes. So here we have your taxable income. And that then the tax is calculated on that taxable income. So you'll notice the tax of $14.60 on $7,892 of income is a little higher than most of our clients would probably, have to pay. So you're you're considering if there's options as to who's going to pay, the the income taxes on the income, and there's an option and there's no charitable contributions, then where would you ideally want to have those, those taxes paid and at what rate? And that's when, if you have the option, like I said, you allocate that or make that determination. So other things that we'll get that's the tax and tax payments. And so let me stop our sharing. Let me go back to our slides. So this is what we just talked about was the taxes. The taxes are calculated within the via state tax return. Taxes get paid. They can be paid through EFTPS. They can be set up I believe they can be set up to withdraw on it. Be withdrawn, from the return, but they can be made one way or another. Polls. So we're gonna take our second poll question. I'm looking for your answer on the electronic payment, if you could do that from within pro series while you're answering this poll. And so what type of trust cannot deduct charitable contributions? I know I mentioned this several times. Maybe had a clue that you're, you were gonna be asked this question on your poll. So no points off for the wrong answers. But if you could go ahead and answer this for us, and I have the answer to the information is yes. At the bottom of the information worksheet on the ten forty one, you can put the information to have the payment of the taxes electronically withdrawn, at the time that you filed the tax return. I was pretty sure it was there, but I just wanted to make sure. And, yes, it is there. So, I'll give you just a couple more seconds to answer the poll question. We're going to talk for just another minute about the ten forty one. So I'll show you, in the return, where that information is about making the payments. And then we're gonna talk about state tax returns. So go ahead and answer that poll question for me if you will. Remember, on the screen, if you still have it or on the right, go to click on polls. You can answer that question. No points off if the answer is not correct. Don't worry about having to go research it. We'll tell you what the correct answer is once we close the poll. Okay. Gonna go ahead and close the poll and go on to the next information that we're gonna talk about, which is the trust and estates. And so when we talk about estate tax returns, what are we talking about? We're talking about individuals who have enough in assets. And starting in 2026, enough in assets is $15,000,000 or more. Now this is, this is their gross estate, and and it also includes lifetime gifts. So when determining whether a taxpayer needs to file an estate tax return, You do have to have the history of any prior gift tax returns that have been filed and also know, what their estate value is or you'll have to construct that to come up with what that is. So I am going to jump back in product and show you screen again real quick just to show you. This is the bottom of the seven zero six I'm sorry. The ten forty one return where you put in the electronic funds information. It's part seven there, to have those paid. And so then I'm going to go back to and jump into my seven zero six return. And just to make sure we don't get any, confidential information, I try to get in there before I flip back over there. Alright. And here we go. Okay. So this is going to be an estate tax return. So this is a tech, taxpayer who has passed, and we're filing their estate tax return. Now you can transfer this information from a prior year return if applicable if you filed a gift tax return. If not, you're just going to enter all of the information there. So you can see that you're putting in their, course of names, their social. If the estate has a federal tax number, you're going to report that. Where they were domiciled, the year, date of birth, date of death, what their marital status was, their executor. Again, this is just all putting in, this information. In some cases, you have more than one. You have co executors. So if that's the case, you put all that here. And you can also put in the representative information. And so if you click that, that's gonna transfer your information into the return. So I go first and I start on the 706. That's gonna transfer the information over. Where where were they, residing? And then you're gonna go start with the, for the gross gross estate information. So if you go to the second page, you'll see that you have a lot of questions about what to enter. Let me go back to the first page. Okay. So here's your okay. If you go if you click in, as with pro series is normally the case, it's going to take you into where you enter the detail. So your first schedule, schedule a, is the real estate. So in order to get to the real estate, you're going to get to a screen that looks like this that says this is for any property. Make sure if it's jointly owned, you disclose that on schedule e. If it's a sole proprietorship, ensure them on schedule f. So you're going to put in this information here. Now, a very important thing that I want to mention about the alternative valuation date, and that is you must state whether the alternative valuation date is going to be used. Alternative valuation date has to be used for all of the assets of the estate, and it can only be used in certain circumstances. So and that that circumstances is if the value is lower than than it would have been otherwise. So make sure that you're, knowledgeable about whether you're eligible to use the the alternative valuation date, and if so, what it is, what the value was, what the value is, and and you put that information here. But this is just your schedule a for real estate. You'll see that there's a schedule b for stocks and bonds. And, again, you're you're entering the information about ownership. This is not reporting income. This is reporting the assets of the individual. So in the case of the, stocks and bonds here, you're gonna need their their statement, at the time that they passed or at the alternate valuation date if that has been decided that it can be and is being used. You would list all of that information here. So once you keep putting in all of these different classes, you've got your mortgages, notes, cash, you've got insurance, life insurance proceeds. Remember, you're gonna attach schedules like a seven twelve. If you go up to the forms menu, you'll see that there isn't a seven twelve in the forms menu. You would need to prepare the seven twelve and attach it. If you don't know how to attach a return, is you go up to e file, and and it will say attach PDF file to field. So once you, on this return or I'm sorry. On the schedule, fill this out, it will say, okay. If you fill this out, then there is a seven twelve required, and it would, it would make this dark so that you can attach a PDF to this field. So if you don't know how to do that, that's how. So you're coming down and you're listing all of these assets, and it's totaling it here. Now there are some deductions that are taken on the estate side as well. And so if you go down, you will see that the funeral expenses, there are debts, there are mortgages. So all of that is reported here. So you would end up with the total amount of deductions from the estate. And so if we go back to the main page, you'll see that this has the total amount of their assets, the total amount of their debt. So the net tentative taxable estate, in this case, $11,000,008.94 $2.50. So what is the tentative tax? Tentative tax is $4,000,007.00 3. But what is their base exclusion? It's thirteen six ten because this is 2024, return that I'm showing as an example. So that would take out any of the the credit is higher, and so you would come down and you would have no estate taxes due, okay, in this case. However, let's go to another example. Let's go to our stocks, bonds, or let's just make it easy and say let's go to the cash. And what is going to be the cash that this individual I'm gonna say, oops, cash and checking accounts. I would normally list these out because I wanna make absolutely certain that I've included them all so that the person signing the return knows I've included them all so that we're at the same place. And we're going to make sure we definitely get over our limit. Two more zeros in there. So we're gonna say there's 10,000,000 in cash and checking. So that puts our estate at 28,000. So when we go back over to the first page, you can see that there is an amount now due because the threshold, remember, is 13. We are higher than that, and so we're coming down and having a a tax amount calculated in due. Now hold up. There's one more thing that needs to be considered here, and that is, prior gift tax deductions that are made. So let's go back to the first page. And you would go here and go to the adjusted taxable gifts. And so you would report the gifts that you made back in a prior time, And it's the gifts made between 1932 and 1977, made after 1976. And so you're gonna detail out what all those gifts are. Now if you've been filing gift tax returns for your clients, remember you can roll this over, and end up with, the the taxable gifts that were made, and then and and, otherwise, you're gonna they'll all be here. So these gifts then subtract out or or add back in if they need to be added in because you gave them a work period of time. So, basically, you preuse part of your estate credit, on gifts that you gave previously. So they'll add here. So, basically, it deducts from what your current eligible exclusion amount is because you had taxed you had excluded tax on those gifts previously, and they were above the annual threshold per person, that you gave. Now if in the past, you paid the gift tax return gift taxes on those gifts, then you would put the amount of gift tax that you paid here. And, again, this will take you back to a report where it will show all of those GIST taxes tax returns that you prepared, filed, and paid the taxes in. So that would be if you have a tax computation. Now one of the other things that you do have to do is you have to, disclose information about the person whose estate you're you're reporting on, such as their passing, their information, who received benefits from the estate, answering other questions about, say, protective claims. And then at the top, you've got other information about, joint tenants. So as with most returns, there's a lot of questions that have to be answered, about the return and then the the retotaling. We'll just keep going down here. You do have the if you have a spouse who has passed and they have an unused exclusion, this is where you would report what that is. There could be other trusts that come into play. There could be assets that are going to be ported to the, portable to the surviving spouse. What I was looking for to show you is and I believe that's back here on the first page. Oh, this is part three, and this is this is something very important. This is where you you discuss or you make the election to use an alternate valuation date. And so there's the alternate valuation. There's the special use value valuation. You can pay the taxes and installments, and you can elect to postpone the taxes due to revisionary remainder interest. So, again, there's, know when an alternate valuation date can be used. If it's going to be used, make sure that it is applied evenly throughout the entire return. And and then you're going to report on page two and part three whether your alternative evaluation date is used. And, you know, I can't stress enough how important it is if the state intends to use this that you've checked this box. Because otherwise, on all of these other schedules that you're completing here, you'll notice that you're reporting the alternate value and then the evaluate date of death. And if you have not made an election, you could have a serious discrepancy in what is considered taxable or not taxable. So that is your, this is your Schedule a real estate. There can be other miscellaneous property. So this would be things like, works of art. If there is something that was due to the decedent, like here it mentions, maybe it was a bonus, maybe it was income, maybe it's something that they were due to receive that they had not yet received. Safety deposit boxes. This is kind of the cleanup. Is there anything else that needs to be included? So that's gonna be your schedule. If we go back and look here, you can see all the different schedules. Here's the insurance, on the decedent's life. Schedule l is net losses, during administration and expenses. So I've had a couple of cases where a person has passed, and they, may have left a will, but they did not leave a current amount of funds like a TOD or a POD where a person had the means to administer the state with the state's expenses. And so then someone else had to pay those and and and reconcile all of this. So, if if there's anything that, you know, if there was a protective claim that needed to be filed, then that's where this could be used here is to file that protective claim. But there's also a lot of other, issues that that happens sometimes, with expenses that would have to be filed to, say, preserve, that would go into, possibly some deductions here, and the expenses incurred in administering that are not subject to claims. So then there's be requests to surviving spouses, charitable public, and other requests. So, you know, state tax returns, I'm sure if you've done any of them, you know, you really, really have, some time on your hands in terms of, the reporting. So I can just say walk thoroughly through all of the client's assets. It's not just going back to the last tax return to see what was reported because in a lot of cases, individuals have assets that aren't necessarily giving off income or generating income or even expenses that give you that clue. So, I find that to stay in touch with trends take, a significant amount of time. It's always helpful if you can if you worked with a client and so you have an idea. But that doesn't even prepare you for the information or the things that, say a client owned a portion of something, an interest in things like a piece of land that they never had any expenses with that that they claimed on their return, for for some reason. Or, a case that I worked recently where, an individual passed and not so long after their spouse passed. And so what was coming to the husband that then was going to the to the spouse was really just a domino effect. And and so that that is still to this day being unwound. But it's all of those details that just you have to look for. And it's also why sometimes you do have to amend that state tax returns. So my best advice on the state tax returns is just be as thorough, review as much as possible with that individual, that's providing the information and get that information reviewed, to make sure it's correct. So I'm just gonna go back over the slides because I kinda showed it all in product, but I wanna make sure we covered it all. We talked about all the income. We talked about the estate tax question, the alternate valuation date, if it's gonna be used. Make sure you check that box. The next one we have here is this where you put on the different fields where the valuation is and then the alternate valuation is. You see here you've got funeral expenses, debts, mortgages, requests, charitable requests that could be done, Of course, the tax calculation. Hopefully, good estate planning keeps this tax to a minimum, but make sure that if they've paid taxes on private gift tax returns, that that information is something that you have considered. So to summarize all that and review, you may not have prepared ten forty one or seven zero six returns before. It is really just stepping through that process. I always go form by form, making sure that anything that's asked is included. And of course, it's always a very good, interview process with the person who is giving you those, giving you that information and making sure that they've reviewed it and and agreed to that as well. So we talked about the ten forty one, how you can have a simple trust. Remember, all those new beneficiaries. A complimentary, a, a concurrent trust, a complex trust where you have beneficiaries that develop that information. And then you could also have the estate tax return and make sure that you consider the gift tax return. So remember that as soon as this, webinar concludes, there will be a survey link. And so the survey, we appreciate the feedback. 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