InstantForum.NET v4.1.4California Society of CPAshttp://forums.calcpa.org/forums@calcpa.orgWed, 16 May 2012 17:39:22 GMT20http://forums.calcpa.org/Topic14-2-1.aspxThe above information is correct, you file Form 5227, 1041A, 541A and 541B. The software leads you through the filing. </P><P>I use Lacerte and it has difficulty calculating the percentage if there are additional gifts made to the CRT so I wind up making manual corrections. I always make sure that someone reviews my CRT returns because they're so unusual. The first time around, see if you can get a colleague or an experienced person at your firm to see if you crossed your t's and dotted your i's.Fri, 16 Dec 2005 13:39:32 GMTArchivedhttp://forums.calcpa.org/Topic14-2-1.aspxOne wrinkle with CRTs, which also applies in your case, is that the calculation of the 5% unitrust amount has to be made after subtracting distributions payable; e.g. for the unitrust amount for 2006, I have to take the values as of 1/1/2006 but subtract any unpaid 2005 unitrust distributions being paid in 2006 before calculating the % for 2006.Fri, 16 Dec 2005 13:38:59 GMTArchivedhttp://forums.calcpa.org/Topic14-2-1.aspx1. you have the correct forms for fed- you might have to file state forms too (541-a and 541-b in calif) </P><P>2. distributions carry out dni on a "worst" taxable income first- so that ordinary interest income from the trust is generally the first income that is carried out (since it is taxed at the highest rate)... and tax-free income from the trust is carried out last. </P><P>3. which tax prep software do you use? most will handle the distribution ordering for youFri, 16 Dec 2005 13:38:33 GMTArchivedhttp://forums.calcpa.org/Topic14-2-1.aspxOur client set up a CRT with their investment advisor. Although I am familiar with the mechanics of the trust, I have not filed income tax returns for a CRT and am not sure of the forms required. </P><P>This is a NIMCRUT, so will distribute very little income initially. I believe we need to file Form 5227 and Form 1041-A, but how to report the unitrust distributions, and character of the distributions, made to the grantors during the year for reporting on their personal returns? </P><P>Appreciate any help you can provide.Fri, 16 Dec 2005 13:38:08 GMTArchived