FACT
COMPREHENSIVE ACCOUNTING ISSUES OF ESTATES AND TRUSTS: FIDUCIARY ACCOUNTING AND TAX ISSUES

Fiduciary income tax is a complex blend of state accounting rules and the tax law of Subchapter J. Only by understanding this interaction can the practitioner acquire the skills and knowledge to provide income tax planning for an estate or trust and its beneficiaries, sure to be an important skill in practice in the new income tax environment.

Major Topics:

• Review of major legal and tax concepts
• Concepts of fiduciary accounting: Principal and income
• The Uniform Principal and Income Act: how specific state laws on principal and income applied to common expenditures and receipts
• How fiduciary accounting determines the timing and amount of distributions
• The crucial differences between fiduciary accounting and tax accounting
• Distinguishing fiduciary accounting income from distributable net income
• Splitting income between the fiduciary and the beneficiaries: distributable net income
• How to set up an accounting system for an estate or trust, prepare a judicial accounting, and record-keep for fiduciary accounting
• How practitioners can handle audits of estates and trusts
• Various exercises and problems

Learning Objectices:

• Distinguish fiduciary accounting income from taxable income and distributable net income
• Account for distributions for accounting and tax purposes
• Identify how the fiduciary income tax return differs from individual income tax
• Understand state law on principal and income

Designed For: All practitioners who wish to learn about the complex and unique accounting issues for estates and trusts
Level of Knowledge: Basic
Prerequisite: Basic knowledge in estate and retirement planning
Advanced Preparation: None
CFP: No
Yellow Book: No
New: No
Credits: 8
Field of Study: Accounting