The Alabama 41 form is a document used for filing the Fiduciary Income Tax Return in Alabama. This form is specifically designed for estates and trusts to report their income and calculate the taxes owed to the state. Understanding the details of this form is crucial for fiduciaries to ensure compliance with Alabama tax laws.
The Alabama 41 form serves as a crucial document for fiduciaries managing estates and trusts within the state. This form is specifically designed to report the income earned by these entities for a given tax year, whether it be a calendar year or a fiscal year. Various types of entities can utilize the Alabama 41, including decedent's estates, simple trusts, complex trusts, and qualified disability trusts, among others. It requires detailed information such as the entity's name, Employer Identification Number (EIN), and the fiduciary's contact details. Additionally, the form includes sections for reporting Alabama taxable income, calculating tax due, and claiming any available credits. Notably, a complete copy of the federal Form 1041 must accompany the Alabama 41 to ensure the return is deemed complete. The form also introduces significant changes in Alabama tax law concerning estates and trusts, reflecting the state’s ongoing efforts to align with federal regulations. Understanding the nuances of this form is essential for fiduciaries to ensure compliance and optimize tax obligations, making it a vital tool in estate and trust management.
FORM
*0612830141*
41
2006
(Rev. 11/06)
ALABAMA DEPARTMENT OF REVENUE
Fiduciary Income Tax Return
For the calendar year 2006 or fiscal year beginning
__________________________, 2006, and ending ____________________________, ___________
Type of entity (see instructions): Decedent’s estate
Simple trust
Complex trust
Qualified disability trust
ESBT (S portion only)
Grantor type trust
Bankruptcy estate – Ch. 7
Bankruptcy estate – Ch. 11
Pooled income fund
Employer Identification Number
Name of Estate or Trust
Name and Title of Fiduciary
Address of Fiduciary (number and street)
City, State, and Zip Code
FN
Initial Return
Amended Return
Final Return
Address change
Entity has income from more than one state
Fiduciary or name change
Date entity created
Number of K-1s attached
Return is Filed on Cash Basis
Nonresident estate or trust
Trust has a nonresident beneficiary
A complete copy of the Federal Form 1041 must be attached for this return to be considered complete.
COMPUTATION OF ALABAMA TAXABLE INCOME AND NET TAX DUE
1
Alabama Adjusted Total Income or (Loss) (Schedule C, Line 18c)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Special Deductions Available to Trusts:
2
Alabama Income Distribution Deduction (Schedule B, Line 16)
3
Exemption (Allowed the Estate or Trust by 40-18-19, Code of Alabama 1975)
4
Total of Special Trust Deductions (Total of Lines 2 and 3)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
5
Alabama Taxable Income (Line 1 less Line 4)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
6a
$__________________ at 2 percent (On first $500, or fraction thereof, of AL Taxable Income) . . .
6A
b$__________________ at 4 percent (On next $2,500, or fraction thereof, of AL Taxable Income) . 6B
c $__________________ at 5 percent (On all over $3,000 of AL Taxable Income)
6C
7
TOTAL INCOME TAX DUE (See instructions)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
8
Credits: a Income tax paid to other states (See instructions for limitations)
8A
b Capital Credit (See instructions for limitations)
8B
c Amount paid with Form 4868A
8C
d Composite payments. Paid by __________________ TIN _____________________
8D
9
Total Credits (Total of Lines 8a through 8d)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
10
NET TAX DUE (Subtract Line 9 from Line 7) PAY THIS AMOUNT IN FULL WITH RETURN
. . . . . . . . . . . . . . . . . . . . . . . . . . . 10
11
NET REFUND (If Line 9 is larger than Line 7, enter overpayment here)
(For official use only)
CN
Returns with payments must be filed with the Alabama Department of Revenue, Individual and Corporate Tax Division, P.O. Box 327444, Montgomery, AL 36132-7444. Returns without payments must be filed with the Alabama Department of Revenue, Individual and Corporate Tax Division, P.O. Box 327440, Montgomery, AL 36132-7440, on or before April 16, 2007. (Fiscal Year Returns must be filed on or before the 15th day of the fourth month following the close of the fiscal year.)
Please
Sign
Here
I authorize a representative of the Department of Revenue to discuss my return and attachments with my preparer.
Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief they are true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.
( )
Signature of fiduciary or officer representing fiduciary
Date
Daytime Telephone No.
Social Security Number
Paid
Preparer’s
Use Only
Preparer’s signature
Firm’s name (or yours, if self-employed) and address
Preparer’s Social Security Number
Check if
self-employed
Tel. (
)
E.I. No.
ZIP Code
*0612830241*
41 2006
Alabama Fiduciary Income Tax Return
PAGE 2
Name of estate or trust
Employer identification number
Name and title of fiduciary
SCHEDULE A – ALABAMA CHARITABLE DEDUCTION. Do not complete for a simple trust or a pooled income fund.
Amounts paid or permanently set aside for charitable purposes from gross income
Alabama tax-exempt income allocable to charitable contributions
Subtract line 2 from line1
Capital gains for the tax year allocated to corpus and paid or permanently set aside for charitable purposes
Alabama Charitable Deduction.Add Line 3 and Line 4. Enter total here and on Page 3, Schedule C, Line 13, Column C
SCHEDULE B – COMPUTATION OF ALABAMA INCOME DISTRIBUTION DEDUCTION
Alabama Adjusted Total Income (Page 1, Lne 1)
2The amount of gain from the sale of capital assets, but only if the gain was allocated to corpus and not paid, credited,
or required to be distributed to any beneficiary during the taxable year or not included in Line 4, Schedule A (see instructions)
3 Subtract the amount entered on Line 2 from the amount entered on Line 1, and enter in Line 3
4The amount of loss from the sale of capital assets – entered as a positive number, only if the loss was not considered
in the determination of the amount to be paid, credited, or required to be distributed to any beneficiary during taxable year
Amount of tax exempt interest income excluded in computing Alabama taxable income
6
Other adjustments – see instructions
Alabama Distributable Net Income (Sum of Lines 3 through 6)
8If a complex trust, enter accounting income for the tax year as determined under the
governing instrument and applicable local law
9 Income required to be distributed currently
Other amounts paid, credited, or otherwise required to be distributed
Total distributions. add Lines 9 and 10
12
Enter the amount of tax-exempt income included on Line 11
13
Tentative income distribution deduction. Subtract Line 12 from Line 11
14
Tentative income distribution deduction. Subtract Line 5 from Line 7. If zero or less, enter -0-
15
Special Alabama Income Distribution Deduction (see instructions for applicability of the special limitation)
16Alabama Income Distribution Deduction. Enter the smallest of Line 13, Line 14, or, if applicable, Line 15,
on this line and on Page 1, Line 2. (Do not enter less than zero.)
16
CHANGE IN ALABAMA TAX LAW
CONCERNING ESTATES AND TRUSTS
The Alabama Legislature passed the Subchapter J and Business Trust Conformity Act (Act Number 2006-114) during the 2006 session. The law was retroactively effective for tax years beginning after December 31, 2004.
At the time the 2006 Form 41 was being developed, the promulgation process had begun for the regulations to implement the Act. Up-to-date information concerning the law and regulations is available on the Alabama Department of Revenue’s Web site (www.revenue.alabama.gov).
*0612830341*
PAGE 3
SCHEDULE C – COMPUTATION OF ALABAMA ADJUSTED TOTAL INCOME
Column A
Column B
Column C
AS REPORTED ON
ALABAMA
ALABAMA AMOUNT
FEDERAL FORM 1041
ADJUSTMENTS
Interest income
Ordinary dividends
Business income or (loss)
Capital gain or loss (see instructions)
Rents, royalties, partnerships, and other estates and trusts
Farm income or (loss)
Ordinary gain or (loss) from Form 4797
Other income
Total Income (Sum of Lines 1 through 8)
Ordinary Deductions:
Interest
Taxes (include federal estate and income taxes)
Fiduciary fees
Charitable deduction
Attorney, accountant, and return preparer fees
Other deductions not subject to the 2% floor
Allowable miscellaneous itemized deductions subject to the 2% floor . .
17
Total Ordinary Deductions (Sum of Lines 10 through 16)
18a
Federal Adjusted Total Income (Line 9 less Line 17 – the amount
entered on this line in Column A must equal the amount entered on
Page 1, Line 17, Form 1041)
18A
18b
Net Alabama Adjustments (Column B, Line 9 less Line 17)
18B
. . . . .
. . . . . . . . . . . . . . . . . . . .
18c
Alabama Adjusted Total Income (Column C, Line 9 less Line 17). Enter here and on Page 1, Line 1
18C
. . . .
.
19 Alabama Tax Exempt Income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
19
Attach a complete explanation, showing all computations, for each item of income or deduction included in Column B (Alabama Adjustments), include also a complete explanation and computation for the items of exempt income. See instructions.
*0612830441*
PAGE 4
SCHEDULE K – SUMMARY OF K-1 INFORMATION
TOTAL ALABAMA AMOUNT
1 Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2 Total dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3 Business income or (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4 Net Alabama capital gain or loss (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5 Rents, royalties, partnerships, and other estates and trusts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6 Farm income or (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7 Ordinary gain or (loss) from Form 4797 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8 Other income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9 Alabama Tax Exempt Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10a Grantor Trust Income (Resident Beneficiaries Only) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10A
10b Grantor trust Deductions (Resident Beneficiaries Only) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10B
10c Net Grantor Trust Income (Resident Beneficiaries Only) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
10C
11 Nonresident Beneficiary – Alabama Source Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
12 Nonresident Beneficiary – Non-Alabama Source Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Directly apportioned deductions:
13a Depreciation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
13A
13b Depletion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
13B
13c Amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
13C
Schedule K is a summary of the information reported on the K-1s prepared with the returns.
CHARACTER OF INCOME – In accordance with §40-18-25(b), CODE OF ALABAMA 1975, the character of the income that is reported by the beneficiary or owner of an estate or trust must reflect the same character the income possessed when the income was originally received by the estate or trust.
ALLOCATION OF THE ALABAMA INCOME DISTRIBUTION DEDUCTION – The amount entered in Page 1, Line 2 (Alabama Income Distribution Deduction) must be allocated to resident beneficiaries and owners, so that the income reported by the beneficiaries or owners will retain its character . Generally the allocation is completed in accordance with Internal Revenue Code §§652 and 662. No amount may be included in the Alabama Income Distribution Deduction which is not included in the gross income of the estate or trust. See the instructions for more guidance concerning the allocation of income to the beneficiaries and owners.
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