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Fixed Assets and UltraTax CS 2023 help is now on Help and Support. We're still moving articles, but you can find most content for the 2023 tax year there. Continue using the Help & How-To Center for tax years 2022 and older.

Question

How is the unitrust distribution calculated?

Answer

The unitrust amount is calculated in one of the following three ways.

• If you mark the Required distribution determined with reference to accounting income field on Screen SIT, the unitrust amount calculates as the lesser of trust accounting income or the unitrust amount. In this case, Form 5227, lines 66a and 66b, are completed.
• If you enter an amount in the Total accrued distribution deficiencies from previous years field on Screen SIT, the unitrust amount calculates to include the deficiency amount. In this case, Form 5227, lines 66a, 67a, and 67b are calculated.
• If both of the fields above are blank, the unitrust amount calculates on line 65b as the product of the unitrust fixed percentages times the FMV of net assets as calculated on Form 5227, Part IV. For the initial year of the trust, the unitrust amount is prorated based on the date in the Date created / decedent's date of death field on Screen 1041. For the final year of the trust, the unitrust amount is prorated based on the date in the Date of termination field on Screen 1041. The result displays on Form 5227, line 68.
  

If there is more than one unitrust beneficiary, the unitrust amount is allocated among the beneficiaries using percentages entered in View > Beneficiary Information > Federal > Other Returns. If there are no percentages, the unitrust amount is allocated evenly among the beneficiaries. There is a field on Screen SIT to force the amount for Form 5227, line 68.

Related topic: 1041-US: Form 5227 FAQs

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