Federal U.S. Income Tax Return for Qualified Funeral Trusts
Extracted from PDF file 2018-federal-form-1041-qft.pdf, last modified December 2018
U.S. Income Tax Return for Qualified Funeral TrustsForm 1041-QFT U.S. Income Tax Return for Qualified Funeral Trusts Department of the Treasury Internal Revenue Service ▶ 1 2018 Go to www.irs.gov/Form1041QFT for the latest information. For calendar year 2018 or short year beginning Part I OMB No. 1545-1593 , 2018, and ending , 2018. General Information 2 Employer identification number (EIN) Name of trust or other entity filing return 3a Name and title of trustee 3b Number, street, and room or suite no. (If a P.O. box, see the instructions.) 3c City or town, state, and ZIP code 5 Check applicable boxes: Initial return Part II Amended return Final return Change in the fiduciary or fiduciary’s name Change in fiduciary’s address Tax Computation 1a b 2a b 3 4 Interest income . . . . . . . . . . . . . Tax-exempt interest. Don’t include on line 1a . . . Total ordinary dividends . . . . . . . . . . Qualified dividends . . . . . . . . . . . . Capital gain or (loss) (attach Schedule D (Form 1041)) Other income. List type and amount . . . . . . . . . . . . . . . . . . 1a . . . . . . . 2a . . 1b . . 2b . . . . . . . . . 3 4 5 6 7 8 9 Total income. Combine lines 1a, 2a, 3, and 4 Taxes . . . . . . . . . . . . . Trustee fees . . . . . . . . . . . Attorney, accountant, and return preparer fees Other deductions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ▶ . . . . 5 6 7 8 9 10 Total deductions. Add lines 6 through 9 . . . . . . . . . . . . . . . ▶ 10 11 Taxable income. Subtract line 10 from line 5 . . . . . . . . . . . . . . ▶ 11 12 13 Tax. (If this is a composite return, check here ▶ ) Credits (see instructions). Specify the credits claimed . . . . . . . . . . . ▶ 12 13 14 15 16 17 18 19 Subtract line 13 from line 12 . . . . . . . . . . . . . . Net Investment Income Tax from Form 8960, line 21 . . . . . . Total tax. Add lines 14 and 15 . . . . . . . . . . . . . Payments (see instructions) . . . . . . . . . . . . . . Tax due. If line 17 is smaller than line 16, enter amount owed . . Overpayment. If line 17 is larger than line 16, enter amount overpaid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 15 16 17 18 19 20 Amount of line 19 to be: a Credited to 2019 estimated tax ▶ Income Deductions Tax and Payments 4 Number of QFTs included on this return . . b Refunded ▶ Signature of trustee or officer representing trustee Print/Type preparer’s name Preparer’s signature ▲ Paid Preparer Use Only ▶ 20 Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete. Declaration of preparer (other than trustee) is based on all information of which preparer has any knowledge. ▲ Sign Here . . . May the IRS discuss this return with the preparer shown below (see instructions)? Yes No Date Date Check if self-employed Firm’s name ▶ Firm’s EIN Firm’s address ▶ Phone no. For Paperwork Reduction Act Notice, see instructions. Cat. No. 25368F PTIN ▶ Form 1041-QFT (2018) Form 1041-QFT (2018) General Instructions Section references are to the Internal Revenue Code. What’s New Global intangible low-taxed income. The Tax Cuts and Jobs Act of 2017 (TCJA) (P.L. 115-97) requires a U.S. shareholder of any controlled foreign corporation to include in gross income its global intangible low-taxed income (GILTI). For more information, see the instructions for line 4, Other Income, later. Deferred foreign income tax. The TCJA requires a U.S. shareholder to pay a transition tax on the untaxed foreign earnings of certain specified foreign corporations as if those earnings had been repatriated to the United States. For more information, see Pub. 5292, How to Calculate Section 965 Amounts and Elections Available to Taxpayers. Tax rate schedule for trusts and estates. The tax rates have changed for 2018. See Line 12—Tax, later. Miscellaneous itemized deductions subject to the 2% floor. In 2018, expenses that qualify as miscellaneous itemized deductions subject to the 2% floor are no longer deductible. Future Developments For the latest information about developments related to Form 1041-QFT and its instructions, such as legislation enacted after they were published, go to www.irs.gov/Form1041QFT. Reminder Net investment income tax (NIIT). An estate or trust may be subject to NIIT. NIIT is a 3.8% tax on the lesser of an estate’s or trust’s undistributed net investment income or the excess of the estate’s or trust’s adjusted gross income over a specified threshold amount. NIIT may need to be included when figuring estimated tax. In addition, there are special rules when figuring NIIT for a composite return. See Composite Return, later. Purpose of Form The trustee of a trust that has elected to be taxed as a qualified funeral trust (QFT) files Form 1041-QFT to report the income, deductions, gains, losses, and tax liability of the QFT. The trustee can use the form to report information for a single QFT or for multiple QFTs having the same trustee. If filing Form 1041-QFT for multiple QFTs, please see the rules discussed under Composite Return, later. Pre-need funeral trusts that don’t qualify as QFTs should see the Instructions for Form 1041, U.S. Income Tax Return for Estates and Trusts, for their filing requirements. Qualified Funeral Trust A QFT is a domestic trust that meets all of the following requirements. • The trust arose as a result of a contract with a person engaged in the trade or business of providing funeral or burial services or property to provide such services. Page • The sole purpose of the trust is to hold, invest, and reinvest funds in the trust and to use those funds solely to pay for funeral or burial services or property to provide such services for the benefit of the beneficiaries of the trust. • The only beneficiaries of the trust are individuals for whom such services or property are to be provided at their death under the contracts described above. • The only contributions to the trust are contributions by or for such beneficiaries’ benefit. • The trustee makes or previously had made the election to treat the trust as a QFT. • The trust would have been treated as owned by the purchasers of the contracts under the grantor trust provisions of the Code if the QFT election hadn’t been made. Note: A trust that isn’t treated as owned by the purchaser solely because of the death of an individual will be treated as meeting this requirement during the 60-day period beginning on the date of that individual’s death. If a QFT has multiple beneficiaries, each beneficiary’s separate interest under a contract is treated as a separate QFT for the purpose of figuring the tax and filing this return. Each beneficiary’s share of the trust’s income is determined in accordance with the beneficiary’s interest in the trust. A beneficiary’s interest in a trust may be determined under any reasonable method. Whenever these instructions refer to a trust or QFT, it includes such separate interests that are treated as separate QFTs. Making the Election The trustee makes the election to treat a trust as a QFT by filing Form 1041-QFT for the trust by the due date (including extensions). You may elect QFT status for a trust’s first eligible year or for any subsequent year. Once made, the election can’t be revoked without the consent of the IRS. Composite Return A trustee may file a single, composite Form 1041-QFT for some or all QFTs of which he or she is the trustee, including QFTs that had a short tax year. You must attach a statement to a composite Form 1041-QFT that includes the following information for each QFT (or separate interest treated as a separate QFT). • The name of the owner or the beneficiary. If you list the name of the owner and that trust has more than one beneficiary, you must separate the trust into shares held by the separate beneficiaries. • The type and gross amount of each type of income earned by the QFT for the tax year. For capital gains, identify separately the amount of (a) net short-term capital gain, (b) net long-term capital gain, (c) 28% rate gain, and (d) unrecaptured section 1250 gain. • The type and amount of each deduction and credit allocable to the QFT. • The tax and payments made for each QFT. • The termination date for each QFT that was terminated during the year. 2 Note: When calculating NIIT for a composite return, treat each beneficiary’s interest in each QFT (within the meaning of section 685) as a separate trust. When To File File Form 1041-QFT by April 15, 2019. The due date for a composite return is also April 15, 2019, even if the return includes QFTs that terminated during the year. If you are filing for a short year, file Form 1041-QFT by the 15th day of the 4th month following the close of the short year. If the due date falls on a Saturday, Sunday, or a legal holiday, file by the next business day. Private Delivery Services (PDSs) You can use certain PDSs designated by the IRS to meet the “timely mailing as timely filing” rule for tax returns. Go to www.irs.gov/ PDS for the current list of designated services. The PDSs can tell you how to get written proof of the mailing date. For the IRS mailing address to use if you’re using a PDS, go to www.irs.gov/ PDSStreetAddresses. ! ▲ CAUTION PDSs can’t deliver items to P.O. boxes. You must use the U.S. Postal Service to mail any item to an IRS P.O. box address. Extension of Time To File Use Form 7004, Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns, to get an extension of time to file. An extension of time to file a return doesn’t extend the time to pay the tax. Where To File File Form 1041-QFT at the following address. Department of Treasury Internal Revenue Service Kansas City, MO 64999 Who Must Sign Trustee The trustee, or an authorized representative, must sign Form 1041-QFT. Paid Preparer Generally, anyone who is paid to prepare a tax return must sign the return and fill in the other blanks in the Paid Preparer Use Only area of the return. The person required to sign the return must: • Complete the required preparer information, • Sign it in the space provided for the preparer’s signature, and • Give you a copy of the return in addition to the copy to be filed with the IRS. Anyone who is paid to prepare the trust’s return must enter their PTIN in the Paid Preparer Use Only section. The PTIN entered must have been issued after September 27, 2010. For information, see Form W-12, IRS Paid Preparer Tax Identification Number (PTIN) Application and Renewal. Form 1041-QFT (2018) Page Paid Preparer Authorization Estimated Tax If the trustee wants to allow the IRS to discuss the QFT’s 2018 tax return with the paid preparer who signed it, check the “Yes” box in the signature area of the return. This authorization applies only to the individual whose signature appears in the Paid Preparer Use Only section of the QFT’s return. It doesn’t apply to the firm, if any, shown in that section. If the “Yes” box is checked, the trustee is authorizing the IRS to call the paid preparer to answer any questions that may arise during the processing of the QFT’s return. The trustee is also authorizing the paid preparer to: • Give the IRS any information that’s missing from the QFT’s return; • Call the IRS for information about the processing of the QFT’s return or the status of its refund or payment(s); and • Respond to certain IRS notices that the trustee has shared with the preparer about math errors, offsets, and return preparation. The trustee isn’t authorizing the paid preparer to receive any refund check, bind the QFT to anything (including any additional tax liability), or otherwise represent the QFT before the IRS. The authorization will automatically end no later than the due date (without regard to extensions) for filing the QFT’s 2019 tax return. If the trustee wants to expand the paid preparer’s authorization or revoke the authorization before it ends, see Pub. 947, Practice Before the IRS and Power of Attorney. Generally, a QFT must pay estimated income tax for 2019 if it expects to owe, after subtracting withholding and credits, at least $1,000 in tax. Estimated tax liability is figured for the individual QFT, and not for a composite return taken as a whole. For details and exceptions, see Form 1041-ES, Estimated Income Tax for Estates and Trusts. Accounting Methods Generally, the penalty for not paying the tax when due is 1/2 of 1% of the unpaid amount for each month or part of a month that it remains unpaid. The maximum penalty is 25% of the unpaid amount. The penalty applies to any unpaid tax on the return. Any penalty is in addition to interest charges on late payments. Figure taxable income using the method of accounting regularly used in keeping the QFT’s books and records. Generally, permissible methods include the cash method, the accrual method, or any other method authorized by the Internal Revenue Code. In all cases, the method used must clearly reflect income. Generally, the QFT may change its accounting method (for income as a whole or for any material item) only by getting consent on Form 3115, Application for Change in Accounting Method. For more information, see Pub. 538, Accounting Periods and Methods. Interest and Penalties Interest Interest is charged on taxes not paid by the due date, even if an extension of time to file is granted. Interest is also charged on the failure-to-pay penalty, failure-to-file penalty, the accuracy-related penalty, and the fraud penalty. The interest charge is figured at a rate determined under section 6621. Late Filing of Return The law provides a penalty of 5% of the tax due for each month, or part of a month, up to a maximum of 25% of the tax due, for each month the return isn’t filed. If the return is more than 60 days late, the minimum penalty is the smaller of $210 or the tax due. The penalty won’t be imposed if you can show that the failure to file on time was due to reasonable cause. If you receive a notice about penalty or interest after filing the return, send us an explanation and we will determine whether you meet the reasonable cause criteria. Do not attach an explanation to the return. Late Payment of Tax Underpaid Estimated Tax If the trustee underpaid estimated tax, use Form 2210, Underpayment of Estimated Tax by Individuals, Estates, and Trusts, to figure any penalty. ! ▲ All QFTs must use a calendar year as their accounting period. If you include interest or any of these penalties with your payment, identify and enter these amounts CAUTION in the bottom margin of Form 1041-QFT. Don’t include the interest or penalty amount in the balance of tax due on line 17. Rounding Off to Whole Dollars Other Penalties You may round off cents to whole dollars on your return and statements. If you do round to whole dollars, you must round all amounts. To round, drop amounts under 50 cents and increase amounts from 50 to 99 cents to the next dollar. For example, $1.39 becomes $1 and $2.50 becomes $3. If you have to add two or more amounts to figure the amount to enter on a line, include cents when adding the amounts and round off only the total. Other penalties can be imposed for negligence, substantial understatement of tax, and fraud. See Pub. 17, Your Federal Income Tax, for details on these penalties. Accounting Period Final Form 1041 If you have an existing EIN(s) that you previously used for filing Form 1041 and that you won’t use again (that is, for QFTs included in a composite return), you should file Form 1041 and check the final return box. 3 Specific Instructions Part I—General Information Line 1—Name of Trust Copy the exact name from the Form SS-4, Application for Employer Identification Number, used to apply for the EIN you are using to file Form 1041-QFT. Line 2—Employer Identification Number (EIN) If the QFT isn’t filing as part of a composite return, use the EIN of the QFT. If the QFT doesn’t have an EIN, it must apply for one. Every trustee that elects to file a composite return must apply for an EIN to be used only for filing Form 1041-QFT. A trustee must use a separate EIN for every Form 1041-QFT it files. A QFT without an EIN can apply for one. • Online—A QFT can receive an EIN by Internet and use it immediately to file a return. Go to the IRS website at www.irs.gov/EIN and click on “Apply for an EIN Online.” • By mail or fax—Send in a completed Form SS-4. Form SS-4 can be obtained online at www.irs.gov/OrderForms. If the QFT hasn’t received its EIN by the time the return is due, write “Applied for” in the space for the EIN. Line 3—Address Include the suite, room, or other unit number after the street address. If the post office doesn’t deliver mail to the street address and you have a P.O. box, show the box number instead of the street address. If you want a third party (such as an accountant or an attorney) to receive mail for the QFT, enter “C/O” on the street address line, followed by the third party’s name and street address or P.O. box. If you change your address (including a new “in care of” name and address) after filing Form 1041-QFT, use Form 8822-B, Change of Address or Responsible Party — Business, to notify the IRS. Line 4—Number of QFTs If this is a composite return, enter the total number of QFTs (including separate interests treated as separate QFTs) included on the return. Part II—Tax Computation Composite Return ! ▲ If this is a composite return, enter in Part II the totals for all the QFTs included on the return. CAUTION Income Line 2a—Total Ordinary Dividends Report all ordinary dividends received during the tax year. Report capital gain distributions on Schedule D (Form 1041), line 13. Form 1041-QFT (2018) Line 2b—Qualified Dividends Enter on line 2b the amount reported on line 2a that is a qualified dividend. A qualified dividend is a dividend received during the tax year from (a) a domestic corporation, or (b) a qualified foreign corporation. A qualified dividend doesn’t include any dividend from a corporation if the corporation is (or was) exempt from income tax under section 501 or 521 for the tax year during which the distribution was made, any amount allowed as a deduction under section 591, or any dividend described under section 404(k). Exception. Some dividends may be reported to the trust as qualified dividends but aren’t qualified dividends. See the instructions for line 2b(2) in the 2018 Instructions for Form 1041 for more information. Line 4—Other Income Enter all other types of income not included on line 1a, 2a, or 3. List the type and amount on an attached statement if the QFT(s) has more than one item. If you are reporting GILTI, include it on the attached statement. You must also complete and attach Form 8992, Global Intangible LowTaxed Income (GILTI). If you are reporting a section 965(a) inclusion, enter the net amount (the section 965(a) inclusion less the section 965(c) deduction) on line 4. You must also complete and attach Form 965, Inclusion of Deferred Foreign Income Upon Transition to Participation Exemption System, and related schedules. Deductions Allocation of Deductions for Tax-Exempt Income Generally, no deduction that would otherwise be allowable is allowed for any expense that is allocable to tax-exempt income, such as interest on state or local bonds. Exception. State income taxes and business expenses that are allocable to tax-exempt interest are deductible. Expenses that are directly allocable to tax-exempt income are allocable only to tax-exempt income. A reasonable proportion of expenses indirectly allocable to both taxexempt income and other income must be allocated to each class of income. Limitations on Deductions Generally, the amount a QFT has “at-risk” limits the loss it can deduct in any tax year. Also, section 469 and its regulations generally limit losses from passive activities to the amount of income derived from all passive activities. Similarly, credits from passive activities are generally limited to the tax attributable to such activities. For details on these and other limitations on deductions, see Deductions in the Instructions for Form 1041. Line 9—Other Deductions Attach your own statement, listing by type and amount all allowable deductions. ! ▲ CAUTION QFTs aren’t allowed a deduction for a personal exemption. Page Line 12—Tax Tax rate schedule. Unless the instructions that follow for Schedule D or Composite Return apply, figure the tax using the Tax Rate Schedule below. Enter the tax on line 12. 2018 Tax Rate Schedule If taxable income is: Over— $0 2,550 9,150 12,500 But not over $2,550 9,150 12,500 ---- Of the amount over— Its tax is: $255 + 1,839 + 3,011.50 + 10% 24% 35% 37% $0 2,550 9,150 12,500 Schedule D. If the QFT had both a net capital gain and any taxable income, or any qualified dividends and any taxable income, complete Part V of Schedule D (Form 1041), and then enter the tax from line 45 of Schedule D on line 12. Composite return. If this is a composite return, check this box and enter on line 12 the total of the tax figured separately for each QFT using either the 2018 Tax Rate Schedule above or Schedule D (Form 1041). Line 13—Credits Specify the type of credit being claimed and attach any required credit forms. If you are claiming more than one type of credit, attach a statement listing the type and amount of each credit claimed. See the Instructions for Form 1041 for details on the credits that may be claimed. Line 15—Net Investment Income Tax For tax years beginning on or after January 1, 2013, a QFT may be liable for the NIIT enacted under section 1411. To determine if this tax applies, see Form 8960, Net Investment Income Tax—Individuals, Estates, and Trusts, and its instructions. Line 16—Total Tax If the QFT owes any additional taxes (for example, alternative minimum tax, recapture taxes, etc.), include these taxes on line 16. To the left of the entry space, write the type and amount of the tax. Also attach to Form 1041-QFT any forms required to figure these taxes (for example, Schedule I (Form 1041)). See the Instructions for Form 1041 for more details on additional taxes that may apply. Line 17—Payments Include on line 17 any of the following. • Estimated tax payments made for 2018. • Tax paid with a request for an extension of time to file. • Federal income tax withheld (for example, backup withholding). • Credit for tax paid on undistributed capital gains. Also attach Copy B of Form 2439, Notice to Shareholder of Undistributed Long-Term Capital Gains. 4 If you elect to pay the section 965 net tax liability in installments under section 965(h): • Complete and attach Form 965-A, Individual Report of Net 965 Tax Liability; • Increase line 17 by the amount of current year net section 965 liability to be paid in installments (from Form 965-A, Part I, column (i)); and • Decrease line 17 by the current year section 965 installment payments (from Form 965-A, Part II, column (k)). Line 18—Tax Due You must pay the tax in full when the return is filed. Make the check or money order payable to “United States Treasury.” Write the EIN from line 2 of the form and “2018 Form 1041-QFT” on the payment. Enclose, but don’t attach, the payment with Form 1041-QFT. Paperwork Reduction Act Notice. We ask for the information on this form to carry out the Internal Revenue laws of the United States. You are required to give us this information. We need it to ensure that you are complying with these laws and to allow us to figure and collect the right amount of tax. You aren’t required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the form displays a valid OMB control number. Books or records relating to a form or its instructions must be retained as long as their contents may become material in the administration of any Internal Revenue law. Generally, tax returns and return information are confidential, as required by section 6103. The time needed to complete and file this form will vary depending on individual circumstances. The estimated average time is: Recordkeeping . . . . 10 hr., 2 min. Learning about the law or the form . . . . . . 2 hr., 18 min. Preparing the form . . . 5 hr., 21 min. Copying, assembling, and sending the form to the IRS . . . . . . . . 48 min. If you have comments concerning the accuracy of these time estimates or suggestions for making this form simpler, we would be happy to hear from you. You can send us comments from www.irs.gov/ FormComments. Or you can send your comments to Internal Revenue Service, Tax Forms and Publications, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224. Don’t send the tax form to this address. Instead, see Where To File, earlier.
2018 Form 1041-QFT
More about the Federal Form 1041-QFT Other Tax Return TY 2018
We last updated the U.S. Income Tax Return for Qualified Funeral Trusts in December 2018, so this is the latest version of Form 1041-QFT, fully updated for tax year 2018. You can download or print current or past-year PDFs of Form 1041-QFT directly from TaxFormFinder. You can print other Federal tax forms here.
Other Federal Other Forms:
|Form Code||Form Name|
|Form 8962||Premium Tax Credit|
|Form W-4V||Voluntary Withholding Request|
|Form W-4||Employee's Withholding Allowance Certificate|
|Form 8840||Closer Connection Exception Statement for Aliens|
|Form 8965||Health Coverage Exemptions|
The Internal Revenue Service usually releases income tax forms for the current tax year between October and January, although changes to some forms can come even later. We last updated Federal Form 1041-QFT from the Internal Revenue Service in December 2018.
Form 1041-QFT is a Federal Other form. Like the Federal Form 1040, states each provide a core tax return form on which most high-level income and tax calculations are performed. While some taxpayers with simple returns can complete their entire tax return on this single form, in most cases various other additional schedules and forms must be completed, depending on the taxpayer's individual situation, to create a complete income tax return package.
Historical Past-Year Versions of Federal Form 1041-QFT
We have a total of eight past-year versions of Form 1041-QFT in the TaxFormFinder archives, including for the previous tax year. Download past year versions of this tax form as PDFs here:
2018 Form 1041-QFT
2017 Form 1041-QFT
2016 Form 1041-QFT
2015 Form 1041-QFT
2014 Form 1041-QFT
2013 Form 1041-QFT
While we do our best to keep our list of Federal Income Tax Forms up to date and complete, we cannot be held liable for errors or omissions. Is the form on this page out-of-date or not working? Please let us know and we will fix it ASAP.