General Instructions

Purpose of Schedule

Use Schedule I (Form 1041) to figure:

  • The estate's or trust's alternative minimum taxable income;

  • The income distribution deduction on a minimum tax basis; and

  • The estate's or trust's alternative minimum tax (AMT).

Who Must Complete Schedule I (Form 1041)

  • Complete Parts I and II if the estate or trust is required to complete Form 1041, Schedule B, Income Distribution Deduction.

  • Complete Schedule I if the estate's or trust's share of alternative minimum taxable income (Part I, line 29) exceeds $23,100.

  • Complete Schedule I if the estate or trust claims any general business credit and line 6 of Part I or line 3 of Part III of Form 3800, General Business Credit, is more than zero.

Recordkeeping

Schedule I contains adjustments and tax preference items that are treated differently for regular tax and AMT purposes. If you, as fiduciary for the estate or trust, completed a form to figure an item for regular tax purposes, you may have to complete it a second time for AMT purposes. Generally, the difference between the amounts on the two forms is the AMT adjustment or tax preference item to enter on Schedule I. Except for Form 1116, Foreign Tax Credit, any additional form completed for AMT purposes does not have to be filed with Form 1041.

For regular tax purposes, some deductions and credits may result in carrybacks or carryforwards to other tax years. Examples are investment interest expense, a net operating loss deduction (NOLD), a capital loss, and the foreign tax credit. Because these items may be refigured for the AMT, the carryback or carryforward amount may be different for regular and AMT purposes. Therefore, you should keep records of these different carryforward and carryback amounts for the AMT and regular tax. The AMT carryforward will be important in completing Schedule I for 2014.

Credit for Prior Year Minimum Tax

Estates and trusts that paid AMT in 2012, or had a minimum tax credit carryforward from the 2012 Form 8801, Credit for Prior Year Minimum Tax—Individuals, Estates, and Trusts, may be eligible for a minimum tax credit in 2013. See Form 8801.

Partners and Shareholders

An estate or trust that is a partner in a partnership or a shareholder in an S corporation must take into account its share of items of income and deductions that enter into the computation of its adjustments and tax preference items.

Allocation of Deductions to Beneficiaries

The distributable net alternative minimum taxable income (DNAMTI) of the estate or trust does not include amounts of depreciation, depletion, and amortization that are allocated to the beneficiaries, just as the distributable net income of the estate or trust does not include these items for regular tax purposes.

Report separately in box 12 of Schedule K-1 (Form 1041), Beneficiary's Share of Income, Deductions, Credits, etc., any adjustments or tax preference items attributable to depreciation (code G), depletion (code H), and amortization (code I) that were allocated to the beneficiaries.

Optional Write-Off for Certain Expenditures

There is no AMT adjustment for the following items if the estate or trust elects to deduct them ratably over the period of time shown for the regular tax.

  • Circulation expenditures—3 years (section 173).

  • Research and experimental expenditures—10 years (section 174(a)).

  • Intangible drilling costs—60 months (section 263(c)).

  • Mining exploration and development costs—10 years (sections 616(a) and 617(a)).

The election must be made in the year the expenditure was made and may be revoked only with IRS consent. See section 59(e) and Regulations section 1.59-1 for more details.


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