FORM 1041 AND FEDERAL/STATE FORM 1041

Filing Your Return(s) and Paying Taxes

IRS e-file

FORM 1041 AND FEDERAL/STATE FORM 1041

Form 1041, U.S. Income Tax Return for Estates and Trusts, is used to report yearly income for estates and trusts. It shows the taxpayer's share of income as the beneficiary of an estate or trust.

The electronic/magnetic media filing of Forms 1041 includes returns filed on magnetic media (magnetic tape or floppy diskette) or electronically. Electronic returns are filed over telephone lines from the participant's communications device or modem into the Electronic Communications System (ECS) at the Philadelphia Submission Processing Center. The state fiduciary return may also be filed electronically along with the federal return.

Who Can Participate
Electronic Return Originator (ERO): A firm, organization or individual who deals directly with the taxpayer. The ERO either prepares tax returns or collects prepared tax returns from taxpayers who wish to have their returns filed electronically or magnetically.

Fiduciary: A fiduciary can develop it's own preparation software, transmit the return electronically, send the return on magnetic media, or use another firm's software or transmission services.

Transmitter: A firm, organization or individual who transmits returns directly to the IRS electronically or on magnetic media.

Software Developer: A firm, organization or individual who develops software for use in preparing returns according to IRS specifications and transmitting returns to the IRS electronically or on magnetic media.

How to Participate
The ERO, Fiduciary, Transmitter, or Software Developer can participate in the program by contacting the ELF Processing Support Section at the Philadelphia Submission Processing Center. The following information will be sent:

Form 9041, Application/Registration for Electronic/Magnetic Media Filing of Business Returns.
Publication 1437, Procedures for Electronic/Magnetic Media Filing of U.S. Income Tax Returns for Estates and Trusts, Form 1041, and
Publication 1438, File Specifications, Validation Criteria and Record Layouts for Electronic/Magnetic Media Filing of U.S. Income Tax Returns for Estates and Trusts, Form 1041, for Tax Year 2000.

The participant completes Form 9041 and forwards it to the Philadelphia Submission Processing Center for processing.

The following requirements apply to all magnetic media participants:

Must be accepted into the program;
Must comply with all procedures and perform validity and consistency checks on the data as explained in the applicable procedures, file specifications and record layouts in the publications mentioned above;
Must maintain a high degree of integrity and accuracy; and
Must be responsible for the security of all transmitted data.

Benefits

Proof of IRS receipt within 5 to 7 days.
Fewer errors means less correspondence with IRS.
Multi-return payment option (one check for up to 5,000 returns).
Multi-signature option (one signature for up to 5,000 returns).
Reduced costs.
One-stop service for the filing of Fed/State returns.

For Further Information
The ECS can be reached by dialing (215) 516-7625.

Electronic Return Originator, Fiduciary, Transmitter, or Software Developer can participate in the program by contacting the ELF Processing Support Section at the Philadelphia Submissions Processing Center at (215)516-7533.

If you have questions about the Form 1041 or other electronic business options, you may visit the Electronic Services section of the IRS web site at www.irs.gov.

Accepted Forms
Form 1041 U.S. Income Tax Return for Estates and Trusts
Schedule C (Form 1040) Profit or Loss from Business
Schedule C-EZ (Form 1040) Net Profit from Business
Schedule D (Form 1041) Capital Gains and Losses
Schedule E (Form 1040) Supplemental Income and Loss
Schedule F Form 1040) (Profit or Loss from Farming
Schedule H (Form 1040) Household Employment Taxes
Schedule J (Form 1041) Information Return - Trust Allocation of an
Accumulation Distribution
Schedule K-1 (Form 1041) Beneficiary's Share of Income, Deductions, Credits, etc.
Form 1116 Foreign Tax Credit
Form 2210 Underpayment of Estimated Tax by Individuals, Estates and Trusts
Form 2210F Underpayment of Estimated Tax By Farmers and Fishermen
Form 2439 Notice to Shareholder of Undistributed Long Term Capital Gains
Form 3468 Investment Credit
Form 4136 Credit For Federal Tax Paid on Fuels
Form 4255 Recapture of Investment Credit
Form 4562 Depreciation and Amortization
Form 4684 Casualties and Thefts
Form 4797 Sale of Business Property
Form 4835 Farm Rental Income and Expenses
Form 4952 Investment Interest Expense Deduction
Form 4970 Tax on Accumulation Distribution of Trusts
Form 4972 Tax on Lump Sum Distribution
Form 6198 At-Risk Limitations
Form 6252 Installment Sale Income
Form 8271 Investor Reporting of Tax Shelter Registration Number
Form 8582 Passive Activity Loss Limitations
Form 8801 Credit for Prior Year Minimum Tax - Individuals and Fiduciaries
Form 8824 Like-Kind Exchanges
Form 8829* Expenses for Business Use of Your Home

Federal/State 1041 Option:
The Federal/State 1041 option offers "One-Stop" service when filing Form 1041 returns. Currently, New York is the only state in the program but any state that has a requirement to file both a state and federal fiduciary return can participate.

Important References:

Publication 3223, Fact Sheet Form 1041 and Federal/State Form 1041
Form 9041, Application for Electronic/Magnetic Media Filing of Business and Employee Benefit Plan Returns
Publication 1437, Procedures for Electronic/Magnetic Media Filing of U.S. Income Tax Returns for Estates and Trusts, Form 1041
Publication 1438, File Specifications, Validation Criteria and Record Layouts for Electronic/Magnetic Media Filing of U.S. Income Tax Returns for Estates and Trusts, Form 1041

Web Link:

Form 1040 e-file