1041-US: Income and deduction sections not completed for an ESBT with only S corporation income (FAQ)

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IRS filing deadline update

The IRS MeF system is now processing returns, and the filing deadline has been extended to 11:59 PM on Wednesday, April 18, 2018. For the latest details, see UltraTax CS alerts and notices.

Question

Why are Form 1041 income and deduction sections not completed for an electing small business trust (ESBT) when the return only has S Corporation income?

Answer

Per the Form 1041 instructions, special rules apply to electing small business trusts. If the trust consists entirely of stock in one or more S corporations, no entries should be made on Form 1041 lines 1 through 22. Instead, a separate schedule should be attached to the return showing the income and deductions. This information will show on the Electing Small Business and Qualified Subchapter S Trust Worksheet.

Related topic: 1041-US: Electing small business trusts FAQs

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