CT-1041 booklet, Connecticut Income Tax Return for Trusts and ...

2009FORMCT-1041ConnecticutIncome TaxReturn for Trustsand EstatesThis bookletcontains:• Form CT-1041• Resident Trusts and Estates• Nonresident Trusts and Estates• Part-Year Resident Trusts• Schedule CT-1041B• Schedule CT-1041C• Schedule CT-1041FA• Form CT-1041 EXT• Form CT-1041ESTax information isavailable on the DRSwebsite atwww.ct.gov/DRSFile Form CT-1041, Form CT-1041EXT,or Form CT-1041ES using the TSC.More Department of Revenue Services tax information is listed on the back cover.

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Table of ContentsWhat's New ........................................................... 4Increase in Flat Income Tax Rate .......................................4Payment Option ..............................................................4Electing Small Business Trust (ESBT) ...............................4Domestic Production Activity Deduction ............................4Other Taxes for Which the Trust or EstateMay Be Liable .................................................... 4Controlling Interest Transfer Taxes .................................4Connecticut Income Tax Withholding .............................4Definitions ............................................................5General Information .............................................6How to Get Help ............................................................. 6Forms and Publications ................................................. 6Where to File ..................................................................6File Electronically . . .6File a Paper Return . . .6Who Must File Form CT-1041 ........................................ 6Federal Form 1041-A and 5227 Filers . . . 6Connecticut Tax Returns for Individuals ......................... 7Tax Returns for Decedents . . . 7Change of Residence of the Grantorof a Revocable Trust .................................................. 7Connecticut Taxable Income forCertain Inter Vivos Trusts ........................................... 7How Part-Year Resident Trusts Are Taxed ..................... 7Connecticut Income Taxation ofBankruptcy Estates .................................................... 7Connecticut Income Taxation ofDebtors Who Are Individuals ...................................... 8Qualifi ed Funeral Trusts (QFT) .......................................8Composite Return . . . 8Reporting for a Portion of a Resident Trust . . .8Special Accruals ............................................................. 8Surety Bond in Lieu of Special Accruals . . . 9Taxable Year and Method of Accounting ........................ 9When to File Form CT-1041 ........................................... 9Using the 2009 Form CT-1041 for aTaxable Year Beginning in 2010 ................................. 9Extension Requests .......................................................9Extension of Time to File . . . 9Extension of Time to Pay the Tax . . . 10Estimated Tax Payments .............................................102010 Estimated Tax Due Dates . . . 10Required Annual Payment . . . 10Guidelines for Banking Institutions . . . 11Annualized Income Installment Method . . . 11Special Rules for Farmers and Fishermen . . . 11Interest on Underpayment of Estimated Tax . . . 11Filing Form CT-2210 . . . 11Interest and Penalties .................................................11Interest . . . 11Penalty for Late Payment or Late Filing . . . 11Penalty for Failure to File . . . 12Waiver of Penalty ......................................................... 12Recordkeeping ............................................................. 12Copies of Returns .........................................................12Order in Which to Complete Form CT-1041and Schedules ..........................................................12Instructions for Form CT-1041 ...........................13Filing Year .....................................................................13Federal Employer Identifi cation Number (FEIN) ...........13Name, FEIN, and Address ............................................13Type of Return ............................................................. 13Resident Status ............................................................13Type of Entity ............................................................... 13Rounding Off to Whole Dollars .................................... 13Negative Numbers ....................................................... 13Form CT-1041 Quick-FileRequirements ...........................................................13Form CT-1041 Quick-FileLine Instructions ...................................................... 13Form CT-1041 Line Instructions .................................. 14Who Must Sign the Return ............................................15Paid Preparer Signature .............................................. 15Mailing the Return .........................................................15Credit for Income Taxes Paid toQualifying Jurisdictions ............................................ 15Worksheet Instructions ................................................ 16Worksheet for Credit for Income TaxesPaid to Qualifying Jurisdictions ................................ 17Connecticut Fiduciary Adjustment ............................... 17Amount Paid or Set Aside for CharitablePurposes . . . 17Member of a Pass-Through Entity . . . 17Beneficiary of Another Trust or Estate . . . 18Entering Additions and Subtractions . . . 18Instructions for Schedule A .............................. 18Additions to Federal Taxable Income .......................... 18Subtractions From Federal Taxable Income ................ 19Form CT-1041, Questions A, B, and C ........................ 19Instructions for Schedule CT-1041B ................ 20Part 1 - Shares of ConnecticutFiduciary Adjustment ............................................... 20Part 2 - Percentage of Resident‚Noncontingent Benefi ciaries .................................... 20Instructions for Schedule CT-1041C . ............... 21Instructions for Schedule CT-1041FA .............. 22Part 1 - Computation of Connecticut Taxof a Nonresident Estate or Trust andPart-Year Resident Trust ......................................... 22Part 2 - Trust or Estate’s and Benefi ciary’s Shareof Income From Connecticut Sources ..................... 23Part 3 - Details of Federal Distributable NetIncome and Amounts of Income DerivedFrom or Connected With Sources WithinConnecticut ............................................................. 23Amended Return ................................................ 26Page 3

DefinitionsFor Connecticut income tax purposes, an estate is eithera resident estate or a nonresident estate. A trust is either aresident trust, nonresident trust, or part-year resident trust. Theresidence of the fiduciary or the beneficiary does not affectthe status of a trust or estate as resident or nonresident.Fiduciary applies to a person who occupies a position ofspecial confidence toward others, such as a trustee, executor,or administrator. A fiduciary is a person who holds in trustproperty in which another person has a beneficial interest orwho receives and controls the income of another.Any reference to “you” in this booklet refers to the fiduciary.Resident estate is where a decedent was a resident ofConnecticut at the time of his or her death. A resident estatealso includes a bankruptcy estate of an individual who at thebeginning of the bankruptcy case is a Connecticut resident.Nonresident estate is an estate that is not a resident estate forany part of the year.Trust means an arrangement ordinarily created either by awill or by an inter vivos declaration where a trustee or trusteestake title to property to protect or conserve it for beneficiariesand classified and treated as a trust for federal income taxpurposes.Testamentary trust is a trust or portion of a trust created bythe will of a decedent.Inter vivos trust is a trust created other than by the will of adecedent.Electing small business trust (ESBT) has the same meaningas for federal income tax purposes.Resident trust means:• A testamentary trust or a portion of the trust if the decedentwas a resident individual at the time of death.• An inter vivos trust or a portion of the trust consisting ofthe property of: 1) a person who was a resident of this stateat the time the property was transferred to the trust if thetrust was then irrevocable; 2) a person who, if the trust wasrevocable at the time the property was transferred to thetrust and has not subsequently become irrevocable, was aresident of this state at the time the property was transferredto the trust; or 3) a person who, if the trust was revocablewhen the property was transferred to the trust but the trusthas subsequently become irrevocable, was a resident of thisstate at the time the trust became irrevocable.For this purpose, a trust is revocable if it is subject to a power,exercisable immediately or at any future time, to revest title inthe person (the grantor) whose property constitutes the trust.A trust becomes irrevocable when the possibility that thepower may be exercised has ended.An irrevocable inter-vivos trust consisting of property of agrantor who is a resident of this state when the property wastransferred to the trust remains irrevocable and a resident trust.The criteria used to determine whether a decedent or grantor isa resident of this state, for Connecticut income tax purposes,are the same criteria used to determine whether an individualis a resident of this state.Nonresident trust is a trust that is not a resident trust for anypart of the year.Part-year resident trust is a trust that meets the definition ofresident trust or nonresident trust for only part of the year.Grantor trust is a legal trust under applicable state law thatis not recognized as a separate taxable entity for income taxpurposes because the grantor or other substantial ownershave not relinquished complete dominion and control overthe trust.Connecticut alternative minimum tax is a tax imposed oncertain individuals, trusts, and estates in addition to theirregular income tax. Fiduciaries who have a federal alternativeminimum tax liability are subject to the Connecticut alternativeminimum tax. The tax rate is the lesser of 19% of adjustedfederal tentative minimum tax or 5½% of adjusted federalalternative minimum taxable income. For information on howto calculate the adjusted federal alternative minimum taxableincome of an inter vivos trust with one or more nonresident,noncontingent beneficiaries, see Connecticut Taxable Incomefor Certain Inter Vivos Trusts on Page 7.The residency status of each beneficiary is determined as ofthe last day of the trust or estate’s taxable year.Distributable net income means distributable net income forfederal income tax purposes.Noncontingent beneficiary is a beneficiary whose interestis not subject to a condition precedent and includes everyindividual to whom a trustee of an inter vivos trust duringthe taxable year: 1) is required to currently distribute incomeor corpus, or both; or 2) properly pays or credits income orcorpus, or both; or 3) may, in the trustee’s discretion, distributeincome or corpus, or both. Noncontingent beneficiary includesevery beneficiary to whom or to whose estate any of thetrust’s income for the taxable year must be distributed at aspecified future date or event and every beneficiary who hasthe unrestricted lifetime or testamentary power, exercisablecurrently or at some future specified date or event, to withdrawany of the trust’s income for the taxable year or to appoint theincome to any person including the estate of the beneficiary.This also applies to a noncontingent beneficiary which is atrust or an estate. Wherever reference is made to an individualwho is a noncontingent beneficiary, that reference includes atrust or estate that is a noncontingent beneficiary, but does notinclude a corporation that is a noncontingent beneficiary.Contingent beneficiary is an individual (or trust or estate)who is a beneficiary, but not a noncontingent beneficiary of aresident inter vivos trust.Page 5

and income from property acquired by the debtor after thecommencement of the case (but before, in each instance,the case is closed, dismissed, or converted to a case underChapter 7, 12, or 13 of the Bankruptcy Code, whicheveroccurs first) are, in general, includible in the estate’s grossincome rather than in the debtor’s gross income for federaland Connecticut income tax purposes. See IRS Notice2006-83, Individual Chapter 11 Debtors, I.R.B. 2006-40(October 2, 2006), for more details. This provision does notapply to a case under Chapter 7 of the Bankruptcy Code wherethe debtor is an individual.Cases under Chapter 12 or Chapter 13 of the BankruptcyCode: No Form CT-1041 must be filed where a case underChapter 12 or Chapter 13 of the Bankruptcy Code has beencommenced.Connecticut Income Taxation of Debtors WhoAre IndividualsTaxation of a debtor who is an individual in a case underChapter 7 or Chapter 11 of the Bankruptcy Code: Theincome, gain, loss, and deduction taxed to and claimedby the estate for federal income tax purposes will not betaxed to and claimed by the debtor for federal income taxpurposes. The Connecticut income tax liability of a debtorwho is an individual is computed on his or her Connecticutadjusted gross income, but the starting point in computingthe debtor’s Connecticut adjusted gross income is his or herfederal adjusted gross income. In computing the debtor’sConnecticut adjusted gross income, not all items of incomeor gain taxable to the debtor for federal income tax purposesare taxable for Connecticut income tax purposes and not allitems of loss and deduction allowable to the debtor for federalincome tax purposes are allowable for Connecticut incometax purposes. To determine whether the debtor is requiredto file a Connecticut income tax return (Form CT-1040 if aresident individual or Form CT-1040NR/PY if a nonresidentor part-year resident individual), see the filing instructions inthe booklets for those returns.Debtors in a case under Chapter 11 of the Bankruptcy Codeshould review the preceding Note.Taxation of a debtor who is an individual in a case underChapter 12 or Chapter 13 of the Bankruptcy Code: Wherethe debtor is an individual, the commencement of a case underChapter 12 or Chapter 13 of the Bankruptcy Code does notcreate a bankruptcy estate for federal or Connecticut incometax purposes. The Connecticut income tax liability of a debtorwho is an individual is computed on his or her Connecticutadjusted gross income, but the starting point in computingthe debtor’s Connecticut income tax liability is the amountof his or her federal adjusted gross income. In computingthe debtor’s Connecticut adjusted gross income, not all itemsof income, gain, loss, or deduction taxed to and claimed bythe debtor for federal income tax purposes are taxed to andclaimed by the debtor for Connecticut income tax purposes. Todetermine whether the debtor is required to file a Connecticutincome tax return (Form CT-1040 if a resident individual, orForm CT-1040NR/PY if a nonresident or part-year residentindividual), see the filing instructions in the booklets forthose returns.Qualified Funeral Trusts (QFT)A trustee that makes the election to be taxed as a QFTfor federal income tax purposes and files federal Form1041-QFT, U.S. Income Tax Return for Qualified FuneralTrusts, will file Form CT-1041 in the same manner as any otherinter vivos trust. See Form CT-1041 Quick-File Requirementson Page 13. If you do not meet the Quick-File Requirements,see Form CT-1041 Line Instructions on Page 14. Thetrustee should write “QFT election” at the top of the front ofForm CT-1041.In the case of a QFT, wherever reference is made in thisbooklet and on Form CT-1041 to federal Form 1041, Line 22,substitute federal Form 1041-QFT, Line 12.Composite ReturnA trustee that files one aggregate federal Form 1041-QFTfor all QFTs of which he or she is the trustee must providean attachment with Form CT-1041 to provide the followinginformation:• The number of QFTs included in the aggregate return;• The name, address, and Social Security Number (SSN) ofthe grantor(s) for each QFT; and• All corresponding beneficiaries for each QFT.A trustee may file one aggregate Form CT-1041 for allConnecticut resident QFTs. The trustee must be able toprovide to DRS, upon request, detailed information for eachseparate QFT that would have been reported on ScheduleCT-1041B, Part 1, and if applicable, Schedule CT-1041B,Part 2, Schedule CT-1041C, and Schedule CT-1041FA.A trustee may file one aggregate Form CT-1041 for allnonresident QFTs that have Connecticut-sourced income.The trustee must be able to provide to DRS, upon request,detailed information for each separate QFT that would havebeen reported on Schedule CT-1041B, Part 1, and ScheduleCT-1041FA, Parts 3, 2, and 1.Reporting for a Portion of a Resident TrustIf a QFT has both resident and nonresident grantors, thetrustee will show how the resident percentage is arrived at forthe QFT. This percentage should be multiplied by the federaltaxable income to arrive at the amount to report on ScheduleCT-1041C, Line 4.Special AccrualsA part-year resident trust must recognize and report items ofincome, gain, loss, or deduction on the accrual basis regardlessof the method of accounting normally used. In general, an itemof income is subject to special accrual if the right to receiveit is fixed and the amount to be paid is determinable withreasonable accuracy at the time the trust changes residencystatus.Page 8

Example: A part-year resident trust sold property on aninstallment basis prior to changing from a resident trust toa nonresident trust and accrued the entire gain on the sale ofthat property to the residency portion of the year.If the trust became a Connecticut resident trust during thetaxable year, it must accrue to the nonresidency portion ofthe year any item of income, gain, loss, or deduction whichunder an accrual method of accounting would be reportableat the time it changed its residence. No accrual is required orallowed for items of income, gain, loss, or deduction derivedfrom or connected with sources within Connecticut.If the trust ceases to be a Connecticut resident trust, it mustaccrue any item of income, gain, loss, or deduction whichunder an accrual method of accounting would be reportableat the time the residence was changed. This includes incomeor gain it elected to report on the installment basis.Surety Bond in Lieu of Special AccrualsThe fiduciary may elect to defer payment of Connecticutincome tax on items of special accrual by filing a suretybond with DRS for an amount not less than the additionalConnecticut income tax that would be payable if no suretybond or other security were filed. If you choose this option,you must file Form CT-1041 for the taxable year when thetrust changed its residence and include a separate statementshowing the nature and amount of each item of accrual as ofthe date of change of residence, together with a computationof the additional Connecticut income tax that would be due ifthe election to file a surety bond had not been made.For more information on the requirements for a suretybond, contact DRS and request a copy of Conn. AgenciesRegs.§12-717(c)(4)-1; Form CT-12-717A, Change ofResident Status - Special Accruals Connecticut Surety BondForm; and Form CT-12-717B, Change of Resident Status -Special Accruals Other Acceptable Security Form.Taxable Year and Method of AccountingThe fiduciary of a trust or estate must use the same taxableyear and method of accounting for Connecticut income taxpurposes used for federal income tax purposes.If the taxable year or method of accounting is changed forfederal income tax purposes, the same changes must be madefor Connecticut income tax purposes. If a return for a periodof less than 12 months is filed for federal income tax purposes,the fiduciary must also file a short period return for Connecticutincome tax purposes.When to File Form CT-1041Form CT-1041 is due on or before April 15, 2010. If the trustor estate is not a calendar year filer, the return is due no laterthan the fifteenth day of the fourth month following the closeof the taxable year. If the due date falls on a Saturday, Sunday,or legal holiday, the next business day is the due date.The return will meet the timely filed and timely payment rulesif it is electronically submitted by midnight on the due date orif the U.S. Postal Service cancellation date or the date recordedor marked by a designated private delivery service (PDS) usinga designated type of service is on or before the due date. Notall services provided by these designated PDSs qualify.The following are the designated PDSs and designated typesof service at the time of publication:Federal Express(FedEx)• FedEx Priority Overnight• FedEx Standard Overnight• FedEx 2Day• FedEx International Priority• FedEx International FirstUnited Parcel Service (UPS)• UPS Next Day Air• UPS Next Day Air Saver• UPS 2nd Day Air• UPS 2nd Day Air A.M.• UPS Worldwide Express Plus• UPS Worldwide ExpressThis list is subject to change. To verify the names of designatedPDSs and designated types of service, visit the DRS websiteto see Policy Statement 2008(3), Designated Private DeliveryServices and Designated Types of Service.Using the 2009 Form CT-1041 for a TaxableYear Beginning in 2010The 2009 Form CT-1041 may be used for a taxable yearbeginning in 2010 if:1. The trust or estate has a taxable year of less than12 months that begins and ends in 2010; and2. The 2010 Form CT-1041 is not available by the time thetrust or estate is required to file its tax return. However,the trust or estate must enter the beginning and endingdates of the taxable year on the 2009 Form CT-1041 andincorporate any tax law changes effective for taxable yearsbeginning on or after January 1, 2010.The fiduciary must attach an explanatory note to the frontof the return if the return is for a short year beginning andending in 2010.If you file your return late or do not pay all the tax due withyour return, see Interest and Penalties on Page 11 to determineif you must report interest and penalty with this return.Extension RequestsExtension of Time to FileIf the trust or estate cannot meet the filing deadline, thefiduciary must file Form CT-1041 EXT and pay all of the taxthe trust or estate expects to owe on or before the due date.Form CT-1041 EXT is included in this booklet. Filing thisform will automatically extend the due date for five monthsif a federal Form 7004, Application for Automatic Extensionof Time to File Certain Business Income, Information, andOther Returns, has been filed. If federal Form 7004 was notfiled, the fiduciary can apply for a five-month extension tofile Form CT-1041 provided there is reasonable cause for therequest. You are not required to attach a copy of the federalextension request to Form CT-1041 EXT.Page 9

Form CT-1041 EXT only extends the time to file FormCT-1041; it does not extend the time to pay the tax due. SeeInterest and Penalties on Page 11 if you do not pay all the taxdue with your request for extension.If the fiduciary is unable to request an extension because ofillness, absence, or other good cause, any person standingin a close personal or business relationship to the fiduciary(including an attorney, accountant, or enrolled agent) maysign the request on the fiduciary’s behalf. This person isconsidered a duly authorized agent for this purpose providedthe request states the reason(s) for a signature other than thatof the fiduciary and states the relationship existing betweenthe fiduciary and the signer.If you expect to owe no additional Connecticut income tax inthe 2009 taxable year after taking into account any Connecticutincome tax withheld or estimated income tax payments youmade, or both, and you have requested an extension of time tofile your 2009 federal income tax return, you are not requiredto file Form CT-1041 EXT.Extension of Time to Pay the TaxThe fiduciary may be eligible for a six-month extension oftime to pay the tax due if it can be shown that paying the taxby the due date will cause undue hardship. The fiduciary mayrequest an extension by filing Form CT-1127, Applicationfor Extension of Time for Payment of Income Tax, on or beforethe due date of the original return.Attach Form CT-1127 to the front of Form CT-1041 orForm CT-1041 EXT and send it on or before the due date. Asevidence of the need for extension, the fiduciary must attach:• A statement of assets and liabilities;• An itemized list of receipts and disbursements for thepreceding three months; and• An explanation of why the fiduciary cannot borrow moneyto pay the tax due.If an extension of time to pay is granted and the fiduciary paysall the tax due by the end of the extension period, a penaltywill not be imposed. However, interest will accrue on anyunpaid tax from the original due date. The fiduciary shouldmake payments as soon as possible to reduce the interest thetrust or estate would otherwise owe. Pay the tax electronicallyor make check payable to: Commissioner of RevenueServices. To ensure payment is applied to your account,write “2009 Form CT-1041” and the Federal Employer IDNumber (FEIN), if applicable, or Social Security Number(SSN), optional, on the front of the check. DRS may submityour check to your bank electronically. Mail payments to:Department of Revenue ServicesAccounts Receivable UnitPO Box 5088Hartford CT 06102-5088Estimated Tax PaymentsGenerally a payment of estimated Connecticut income taxis required if the Connecticut income tax (after tax credits)minus Connecticut tax withheld is $1,000 or more and it isexpected the Connecticut income tax withheld will be lessthan the required annual payment.Except as provided below, a trust created in 2009 must use90% of the income tax shown on the 2009 Form CT-1041 asthe required annual payment.ExceptionsDecedent’s Estates: For any taxable year ending before thedate that is two years after a decedent’s death, the decedent’sestate is not required to make estimated payments and nounderpayment interest will be charged.Certain Grantor Trusts: For any taxable year ending beforethe date that is two years after a decedent’s death, a trust is notrequired to make estimated payments and no underpaymentinterest will be charged if:• The trust was created under I.R.C. §§671 through 679,inclusive, as owned by the decedent and will receive theresidue of the decedent’s estate under the will; or• If no will is admitted to probate, the trust is primarilyresponsible for paying debts, taxes, and expenses ofadministration.Required Annual PaymentThe required annual income tax payment for the 2010 taxableyear is the lesser of:2010 Estimated Tax Due DatesDue dates of installments and the amount of required payments for 2010 calendar year taxpayers are:April 15, 2010 25% of your required annual payment25% of your required annual payment (A total of 50% of your required annualJune 15, 2010 payment should be paid by this date.)25% of your required annual payment (A total of 75% of your required annualSeptember 15, 2010 payment should be paid by this date.)25% of your required annual payment (A total of 100% of your required annualJanuary 15, 2011payment should be paid by this date.)An estimate is considered timely filed if received on or before the due date, or if the date shown by the U.S. Postal Servicecancellation mark is on or before the due date. Taxpayers who report on other than a calendar year basis should use their federal estimatedtax installment due dates. If the due date falls on a Saturday, Sunday, or legal holiday, the next business day is the due date.Page 10

• 90% of the income tax shown on the 2010 Connecticutincome tax return; or• 100% of the income tax shown on the 2009 Connecticutincome tax return if the fiduciary filed a 2009 Connecticutincome tax return that covered a full 12-month period.The fiduciary is not required to make estimated income taxpayments if:• The trust or estate was a resident trust or estate during theentire 2009 taxable year and did not file a 2009 Connecticutincome tax return because the trust or estate had noConnecticut income tax liability; or• The estate or trust was a nonresident estate or nonresidentor part-year resident trust with Connecticut-sourcedincome during the 2009 taxable year and did not file a 2009Connecticut income tax return because the estate or trusthad no Connecticut income tax liability.If a nonresident estate or trust or part-year resident trust did nothave Connecticut-sourced income in 2009, the fiduciary mustuse 90% of the income tax shown on the 2010 Connecticutincome tax return as the required annual payment.A trust created in 2010 must use 90% of the income tax shownon the 2010 Form CT-1041 as the required annual payment.Use Form CT-1041ES, Estimated Connecticut Income Taxfor Trusts and Estates, to make estimated Connecticut incometax payments for 2010.Guidelines for Banking InstitutionsBanking institutions that wish to file multiple estimatedConnecticut income tax payments, see InformationalPublication 2009(26), A Guide for Filers of Multiple FormCT-1041ES.Annualized Income Installment MethodIf the trust or estate income varies throughout the year, thetrust or estate may be able to reduce or eliminate the amountof an estimated tax payment for one or more periods by usingthe annualized income installment method. See InformationalPublication 2009(30), A Guide to Calculating Your AnnualizedEstimated Tax Installments and Worksheet CT-1040 AES,and Form CT-2210, Underpayment of Estimated Income Taxby Individuals, Trusts, and Estates.Special Rules for Farmers and FishermenIf the trust or estate had income from farming or fishing asprovided in I.R.C. §6654(i)(2), the required installment is thelesser of 66⅔% of the Connecticut income tax shown onthe 2010 Form CT-1041 return or 100% of the Connecticutincome tax shown on the 2009 Form CT-1041 if a 2009Form CT-1041 was filed and it covered a 12-month period.If the trust or estate is required to make 2010 estimatedincome tax payments, you must do one of the following:• Pay the required installment on or before January 15, 2011;or• File Form CT-1041 for 2010 on or before March 1, 2011,and pay the full amount computed on the return. In thiscase do not make estimated tax payments for 2010.Farmers or fishermen who use these special rules must completeand attach Form CT-2210 to their Connecticut income taxreturn to avoid being billed for interest on the underpaymentof estimated income tax. Form CT-2210, Part I, Box D, mustbe checked as well as the box for Form CT-2210 on the frontof Form CT-1041. See Informational Publication 2008(19),Farmer’s Guide to Sales and Use Taxes‚ Motor VehicleFuels Tax‚ Estimated Income Tax‚ and Withholding Tax‚ orInformational Publication 2009(14), Fisherman’s Guide toSales and Use Taxes and Estimated Income Tax.Interest on Underpayment of Estimated TaxIf the fiduciary did not pay enough tax through withholdingor estimated payments, or both, by any installment due date,interest may be charged. This is true even if the trust or estateis due a refund on the income tax return. Interest is calculatedseparately for each installment. Therefore, interest may beowed for an earlier installment even if the fiduciary paidenough tax later to make up the underpayment. Interest at 1%per month or fraction of a month will be added to the tax dueuntil the earlier of April 15, 2010, or the date on which theunderpayment is paid.A fiduciary who files a 2009 Connecticut income tax returnon or before January 31, 2010, and pays the amount computedon the return as payable in full on or before that date will notbe charged interest for failing to make the estimated paymentdue January 15, 2010.Filing Form CT-2210The trust or estate may be charged interest if the 2009Connecticut income tax after tax credits minus Connecticut taxwithheld is $1,000 or more. Use Form CT-2210 to calculateinterest on the underpayment of estimated tax. Form CT-2210and detailed instructions are available from DRS. However,this is a complex form and you may prefer to have DRScalculate the interest and send you a bill.Interest and PenaltiesInterestIn general, interest applies to any portion of the tax not paidon or before the original due date of the return.If you do not pay the tax when due, the trust or estate will oweinterest at the rate of 1% per month or fraction of a month untilthe tax is paid in full.If the fiduciary did not pay enough tax through withholdingor estimated payments, or both, by any installment due date,interest may be charged. This is true even if the trust orestate is due a refund when the income tax return is filed. SeeInterest on Underpayment of Estimated Tax above.Penalty for Late Payment or Late FilingThe penalty for underpayment of tax is 10% of the tax not paidon or before the original due date of the return or $50, whicheverPage 11

is greater. If a request for an extension of time has beengranted, the trust or estate can avoid a penalty for failure to paythe full amount due by the original due date if the fiduciary:• Pays at least 90% of the income tax shown to be due on thereturn on or before the original due date of the return; and• Pays the balance due with the return on or before theextended due date.The Commissioner of Revenue Services may impose a $50penalty for the late filing of any return or report required bylaw to be filed even if no tax is due.Penalty for Failure to FileIf the fiduciary does not file the return and DRS files a returnfor the trust or estate, the penalty for failure to file is 10% of thebalance due or $50, whichever is greater. If the fiduciary wasrequired to file an amended Form CT-1041 and failed to do so,a penalty may be imposed. See Amended Return on Page 26.Waiver of PenaltyYou may request a waiver of penalty after you have filed thereturn and paid the tax and interest due. The penalty may bewaived if the failure to file or pay tax on time was due to areasonable cause and was not intentional or due to neglect.Interest cannot be waived.To apply for a waiver of penalty online, visit the DRS websiteat www.ct.gov/TSC, log into your account, and selectAccount Detail.If you submit your request in writing, you must include:• A clear and complete written explanation;• The name of the trust or estate and FEIN or SSN, if applicable;• The taxable filing period;• The name of the original form filed or billing noticereceived; and• Documentation supporting your explanation.Attach your request to the front of the tax return or mailseparately with a copy of the tax return to:Department of Revenue ServicesPenalty Waiver UnitPO Box 5089Hartford CT 06102-5089RecordkeepingKeep a copy of the tax return, worksheets you used, andrecords of all items appearing on the return (such as W-2and 1099 forms) until the statute of limitations expires for thatreturn. Usually, this is three years from the date the return wasdue or filed, whichever is later. You may need this informationto prepare future returns or to file amended returns.Copies of ReturnsCopies of previously-filed Connecticut income tax returns maybe requested from DRS by completing LGL-002, Requestfor Disclosure of Tax Return or Tax Return Information.Requests are normally processed in three weeks.Order in Which to Complete Form CT-1041 andSchedulesFor trusts or estates that do not meet the Quick-FileRequirements: See Form CT-1041 Quick-File Requirementson Page 13 for verification.Complete Form CT-1041 and the schedules for resident andnonresident estates, full-year resident and nonresident trusts,and part-year resident trusts in the following order.1. Resident trust or estate with resident beneficiaries:• Schedule A;• Schedule CT-1041B, Part 1;• Schedule CT-1041C;• The front of Form CT-1041; and• Form CT-1041 Schedule I, Parts 1 and 2, as necessary.2. Resident estate or full-year resident testamentarytrust with any nonresident beneficiaries or a full-yearresident inter vivos trust with nonresident, contingentbeneficiaries but without nonresident, noncontingentbeneficiaries:• Schedule A;• Schedule CT-1041B, Part 1;• Schedule CT-1041FA, Parts 3 and 2;• Schedule CT-1041C;• The front of Form CT-1041; and• Form CT-1041 Schedule I, Parts 1 and 2, as necessary.3. Full-year resident inter vivos trust with nonresident,noncontingent beneficiaries:• Schedule A;• Schedule CT-1041B, Parts 1 and 2;• Schedule CT-1041FA, Parts 3 and 2;• Schedule CT-1041C;• The front of Form CT-1041; and• Form CT-1041 Schedule I, Parts 1 and 2, as necessary.4. Nonresident estate, full-year nonresident trust, orpart-year resident inter vivos trust without nonresident,noncontingent beneficiaries:• Schedule A;• Schedule CT-1041B, Part 1;• Schedule CT-1041FA, Parts 3, 2, and 1;• The front of Form CT-1041; and• Form CT-1041 Schedule I, Parts 1 and 2, as necessary.5. Part-year resident inter vivos trust with nonresident,noncontingent beneficiaries:• Schedule A;• Schedule CT-1041B, Parts 1 and 2;• Schedule CT-1041FA‚ Parts 3, 2, and 1;• The front of Form CT-1041; and• Form CT-1041 Schedule I, Parts 1 and 2, as necessary.Form CT-8801, Credit for Prior Year’s Connecticut MinimumTax for Individuals‚ Trusts‚ and Estates‚ must be completedas necessary for all types of trusts and estates that expect acredit or credit carryforward of alternative minimum tax paidin a prior year.Page 12

Instructions for Form CT-1041Filing YearAll information on Form CT-1041, Connecticut Income TaxReturn for Trusts and Estates, should be for the calendar yearJanuary 1 through December 31, 2009, or any fiscal yearbeginning in 2009. If filing for a fiscal year or short taxableyear, enter the month and day the taxable year began and themonth, day, and year it ended at the top of Page 1.Federal Employer Identification Number(FEIN)The Department of Revenue Services (DRS no longerprocesses income tax returns for trusts and estates without anFEIN. You can no longer write “applied for” in the FEIN field.You must have applied for and been issued an FEIN beforeyou file a return. However, if you have not received the FEINby April 15 for the calendar year filers or for noncalendar yearfilers by the fifteenth day of the fourth month following theclose of the taxable year, file the return without the FEIN andpay the tax due. DRS will contact you upon receipt of thereturn and will hold the return until you receive the FEIN andforward the information to DRS. For information on how toobtain an FEIN, contact the IRS. See the back cover.Name, FEIN, and AddressEnter the name and FEIN of the trust or estate and the name andaddress of the fiduciary in the spaces on Page 1 of the return.Enter the name and FEIN of the trust or estate in the spacesprovided on all applicable schedules.Type of ReturnCheck the applicable box if:• The trust or estate has been terminated and this is a finalreturn; or• This is an amended return. Attach a statement explainingthe reason for filing an amended return.Resident StatusEnter the date the trust or estate was created and the datethe trust or estate was terminated, if applicable, in the spaceprovided.Check only one applicable box to identify the residency statusof the trust or estate.The trust would be a part-year resident trust if:• It was revocable when property was transferred to it buthas become irrevocable subsequently; and• The residency status of the grantor, whether as a residentor nonresident individual, during the taxable year thetrust became irrevocable differs from the residency statusof the grantor during the taxable year that property wastransferred to the trust.Type of EntityCheck the applicable box to identify the type of trust or estate.Also check the appropriate box to indicate if the trust wascreated by the will of the decedent or is an inter vivos trust.Rounding Off to Whole DollarsYou must round off cents to the nearest whole dollar on yourreturn and schedules. If you do not round, DRS will disregardthe cents.Round down to the next lowest dollar all amounts that include1 through 49 cents. Round up to the next highest dollar allamounts that include 50 through 99 cents. However, if youneed to add two or more amounts to compute the amount toenter on a line, include cents and round off only the total.Example: Add two amounts ($1.29 + $3.21) to compute thetotal ($4.50) to enter on a line. $4.50 is rounded to $5.00 andentered on the line.Negative NumbersWhen entering a negative number, you must precede thenumber with a minus sign or bracket the amount.Form CT-1041 Quick-File RequirementsThe fiduciary of a resident estate or full-year resident trust mayQuick-File Form CT-1041 if the resident estate or full-yearresident trust has no:• Nonresident beneficiaries;• Schedule A‚ Connecticut fiduciary adjustments;• Connecticut alternative minimum tax;• Adjusted net Connecticut minimum tax credit; and• Federal election to be treated as an Electing Small BusinessTrust (ESBT).A trustee that files one aggregate federal Form 1041-QFT,U.S. Income Tax Return for Qualified Funeral Trusts,for all qualified funeral trusts (QFT) may Quick-File oneaggregate Form CT-1041 for all Connecticut resident QFTsas long as all grantors and all beneficiaries of every QFT areConnecticut residents.Form CT-1041 Quick-File Line InstructionsLine 1 - Connecticut Taxable IncomeEnter federal taxable income of a trust or estate from federalForm 1041, Line 22. If you are the trustee of the bankruptcyestate of a debtor who is an individual in a case underChapter 7 or Chapter 11 of the Bankruptcy Code, you may,in computing the estate’s federal taxable income, deduct theexemption amount under I.R.C. §151(d)(1), but may not deductthe personal exemption under I.R.C. §642(b).Page 13

Line 2 - Connecticut Income TaxMultiply Line 1 by 6.5% and enter the result.Line 3 - Allocated Connecticut Income TaxDo not complete Line 3.Line 4 - Credit for Income Tax Paid to QualifyingJurisdictionsResident Estates and Full-Year Resident Trusts OnlyEnter the amount from Worksheet for Credit for Income TaxesPaid to Qualifying Jurisdictions, Line 8, on Page 17. Youmust attach a copy of all income tax returns filed withqualifying jurisdictions to the back of the Form CT-1041 orthe credit will be disallowed.Line 5Subtract Line 4 from Line 2. If Line 4 is greater thanLine 2, enter “0.”Line 6 - Connecticut Alternative Minimum TaxDo not complete Line 6.Line 7Enter the amount from Line 5.Line 8 - Adjusted Net Connecticut MinimumTax CreditDo not complete Line 8.Line 9 - Connecticut Income TaxEnter the amount from Line 7.Lines 10 - 23To complete Lines 10 through 23, see Form CT-1041 LineInstructions below.See Who Must Sign the Return, Paid Preparer Signature, andMailing the Return on Page 15.Form CT-1041 Line InstructionsFor trusts or estates that do not meet the Quick-FileRequirements.Line 1 - Connecticut Taxable IncomeResident Estate or Full-Year Resident Trust OnlyEnter the amount from Schedule CT-1041C, Line 14.Line 2 - Connecticut Income TaxResident Estate or Full-Year Resident Trust OnlyMultiply Line 1 by 6.5% and enter the result.Line 3 - Allocated Connecticut Income TaxNonresident Estates or Trusts and Part-Year ResidentTrusts OnlyEnter the amount from Schedule CT-1041FA, Part 1,Line 12.Line 4 - Credit for Income Tax Paid to QualifyingJurisdictionsResident Estates and Full or Part-Year Resident TrustsOnlyEnter the amount from Worksheet for Credit for Income TaxesPaid to Qualifying Jurisdictions, Line 8. You must attach a copyof all income tax returns filed with qualifying jurisdictions tothe back of the Form CT-1041 or the credit will be disallowed.See Credit for Income Taxes Paid to Qualifying Jurisdictionson Page 15 and Worksheet Instructions on Page 16.Line 5Resident Estates and TrustsSubtract Line 4 from Line 2.Part-Year Resident TrustsSubtract Line 4 from Line 3. If the result is zero or less,enter “0.”Line 6 - Connecticut Alternative Minimum TaxIf the trust or estate was required to pay federal alternativeminimum tax for 2009, you must file Form CT-1041Schedule I, Connecticut Alternative Minimum TaxComputation of Trusts or Estates. Enter the amount fromForm CT-1041 Schedule I, Part 1, Line 23. To obtain FormCT-1041 Schedule I, see Forms and Publications on Page 6.Line 7Add Line 5 and Line 6 and enter the total.Line 8 - Adjusted Net Connecticut Minimum TaxCreditEnter the amount from the appropriate line of FormCT-8801, Credit for Prior Year’s Connecticut Minimum Tax forIndividuals, Trusts, and Estates. If you did not pay Connecticutalternative minimum tax in a prior year or you entered anamount on Line 6 of this form, enter “0.”Line 9 - Connecticut Income TaxSubtract Line 8 from Line 7 and enter the result.Line 10 - Connecticut Income Tax WithheldThis amount must total the Connecticut income taxeswithheld as indicated on the copies of W-2, W-2G,Schedule CT K-1, and certain 1099 forms. Enter onlyConnecticut income tax withheld. Be sure you staple the copyof all W-2 forms and any other forms showing Connecticuttax withheld to the front of the return or the claim of amountswithheld will not be allowed.Line 11 - Estimated Tax PaidEnter the total of all 2009 estimated income tax paymentsand any 2008 income tax overpayment credited to 2009. Besure to include any 2009 estimated income tax paymentsmade in 2010.Page 14

Line 12 - Payments Made With Extension RequestIf you filed Form CT-1041 EXT, Application for Extensionof Time to File Connecticut Income Tax Return for Trustsand Estates, for 2009, enter the amount you paid withForm CT-1041 EXT.If this is an amended return, also include the amount paid withthe original return.Line 13 - Total PaymentsAdd Lines 10, 11, and 12 and enter the total.Line 14 - Amount OverpaidIf Line 13 is greater than Line 9, subtract Line 9 fromLine 13 and enter the result. This is the amount of theoverpayment. To properly allocate the overpayment, go toLines 15 and 18. If Line 13 is less than Line 9, go to Line 19.Line 15 - Amount of Line 14 to Be Applied to 2010Estimated TaxEnter the amount of the 2009 overpayment you wish toapply to the 2010 Connecticut estimated income tax. It willbe treated as an estimate filed on April 15, 2010, if the returnis filed on time or if you filed a timely request for extensionand the return is filed within the extension period. Forfiscal year filers, it will be treated as an estimate filed on thefifteenth day of the fourth month of the 2010 taxable year.Your decision to apply this amount to 2010 estimated incometax is irrevocable.Line 16 - Balance of OverpaymentSubtract Line 15 from Line 14 and enter the result.Line 17 - Reserved for Future Use.Line 18 - Amount to Be RefundedEnter the amount from Line 16. This is the amount of refund.Line 19 - Amount of Tax DueIf Line 9 is greater than Line 13, subtract Line 13 fromLine 9 and enter the result.Line 20 - Penalty for Late Payment or FilingIf you are making a late payment or filing the return after thedue date of the return, see Penalty for Late Payment or LateFiling on Page 11.Line 21 - Interest for Late PaymentIf you fail to pay the tax when due, see Interest on Page 11.Line 22 - Interest on Underpayments of EstimatedTaxIf Line 9 minus Line 10 is $1,000 or more, the trust orestate may owe interest on estimated income tax you eitherunderpaid or paid late. Form CT-2210, Underpayment ofEstimated Income Tax by Individuals‚ Trusts‚ and Estates‚can help you find out if you did underestimate and help youcalculate the interest.If you prefer to have DRS calculate the interest, do notfile Form CT-2210; leave Line 22 blank and we will billyou. Interest on underpayment of estimated income taxstops accruing on the earlier of the day you pay the tax orApril 15, 2010.Line 23 - Amount DueAdd Lines 19 through 22 and enter the total. Pay the amountin full with the return. Pay the tax electronically or makecheck payable to: Commissioner of Revenue Services. Write“2009 Form CT-1041” and the FEIN on the front of the check.DRS may submit your check to your bank electronically.Who Must Sign the ReturnThe fiduciary or an officer representing the fiduciary must signand date Form CT-1041 on the back of the return.Paid Preparer SignatureA paid preparer must sign and date Form CT-1041. Paidpreparers must also enter their Preparer Tax IdentificationNumber (PTIN) or Social Security Number (SSN), their firm’saddress, FEIN, and telephone number in the spaces provided.Mailing the ReturnSee Where to File on Page 6. If you file a paper return, makea copy of this return for the records of the trust or estate.Attach copies of any required schedules and forms to thisreturn. Do not attach copies of the federal income tax returnor federal schedules.Credit for Income Taxes Paid to QualifyingJurisdictionsResident estates, full-year resident trusts, and part-yearresident trusts, use the worksheet on Page 17 to calculate acredit against the Connecticut income tax liability for incometaxes paid for the taxable year to another state or a politicalsubdivision of that state or to the District of Columbia. Creditmay only be claimed if the income on which taxes werepaid was derived from or connected with sources withinthe qualifying jurisdiction. For part-year resident trusts, thecredit is allowed only for that portion of the taxable year inwhich a taxpayer was a Connecticut resident trust.No credit is allowed for any of the following:• Income tax payments made to a qualifying jurisdiction onincome not included in Connecticut taxable income;• Income tax paid to a jurisdiction that is not a qualifyingjurisdiction including a foreign country or its provinces(for example, Canada and Canadian provinces);• Alternative minimum tax paid to a qualifying jurisdiction;• Income tax paid to a qualifying jurisdiction if the fiduciaryclaimed credit on that other jurisdiction’s income tax returnfor income taxes paid to Connecticut; or• Penalties or interest on income taxes the fiduciary paid toa qualifying jurisdiction.Page 15

The allowable credit must be separately computed foreach qualifying jurisdiction. Use separate columns for eachjurisdiction for which you are claiming a credit. If you needmore than two columns, you should create an identicalworksheet. Attach a copy of all income tax returns filed withqualifying jurisdictions to the back of your Form CT-1041or the credit will be disallowed.If you are claiming credit for income taxes paid to another stateand to one of its political subdivisions, follow these rules todetermine your credit:A. If the same amount of income is taxed by both the cityand state:1. Use only one column of the worksheet to calculate yourcredit;2. Enter the same income taxed by both the city and stateon Line 2 on the worksheet; and3. Combine the amounts of tax paid to the city and thestate on that income and enter the total on Line 6.B. If the amounts of income taxed by both the city and stateare not the same:1. Use two columns on the worksheet;2. Enter only the income taxed by both jurisdictions onLine 2 in the first column; and3. Enter the excess income taxed by only one of thejurisdictions in the next column.The credit claimed cannot exceed the amount of tax dueto Connecticut on that portion of income taxed in anotherjurisdiction.Worksheet InstructionsLine 1 - Connecticut Taxable Income of ResidentTrust or EstateEnter:1. The Connecticut taxable income from Form CT-1041,Line 1; and2. Any net loss derived from or connected with sources in oneor more qualifying jurisdiction(s) where you were subjectto income taxation whether or not income tax was actuallypaid to the jurisdiction(s).Example: Taxpayer B, a resident trust, has taxable incomeof $70,000, which includes income of $15,000 from businessactivities conducted in Massachusetts and a net loss of$15,000 from a business conducted in Rhode Island. Thefiduciary of this trust must add the $15,000 net loss to the$70,000 and enter $85,000 on Line 1.Part-Year Resident TrustEnter the amount from Schedule CT-1041FA, Part 1, Line 9,with the following exceptions:1. Add to the amount from Schedule CT-1041FA,Part 1, Line 9, any net loss derived from or connected withsources in one or more qualifying jurisdiction(s) where youwere subject to income taxation whether or not income taxwas actually paid to the jurisdiction(s); and2. For the period the trust is a Connecticut resident trust, addback any item of loss or deduction and subtract any itemof income or gain that is an item of special accrual.Enter the modified amount on Line 1 of the worksheet.Example: Taxpayer L, a part-year resident trust, has taxableincome from its residency period of $60,000, which includesincome of $15,000 from business activities conducted inMassachusetts and a net loss of $20,000 from a businessconducted in Rhode Island. The fiduciary of this trust mustadd the $20,000 net loss to the $60,000 and enter $80,000on Line 1.Line 2 - Non-Connecticut IncomeResident Trust or EstateEnter the total non-Connecticut income included on Line 1 andreported on another jurisdiction’s income tax return.Part-Year Resident TrustEnter the total non-Connecticut income for the period ofConnecticut residency included on Line 1 and reported onanother jurisdiction’s income tax return.For the period the trust is a Connecticut resident trust, addback any item of loss or deduction and subtract any item ofincome or gain that is an item of special accrual.Line 3Resident and Part-Year Resident TrustDivide Line 2 by Line 1. The result cannot exceed 1.0000.Round to four decimal places.Line 4 - Connecticut Income Tax LiabilityResident Trust or EstateEnter the Connecticut tax liability as shown onForm CT-1041, Line 2.Part-Year Resident TrustEnter the allocated Connecticut income tax liability asshown on Schedule CT-1041FA, Line 12. To determine theConnecticut income tax liability of a part-year resident trust,the tax applies to the income derived from or connected withsources within this state. The income derived from or connectedwith sources within this state for a part-year resident trust isthe sum of the trust’s Connecticut taxable income during theresidency portion of the taxable year and the trust’s incomederived from or connected with sources within Connecticutduring the nonresidency portion of the taxable year.Line 5Multiply Line 3 by Line 4 and enter the result.Line 6 - Income Tax Paid to Qualifying JurisdictionsResident Trust or EstateEnter the total amount of income tax paid to a qualifyingjurisdiction for the taxable year.Page 16

Worksheet for Credit for Income Taxes Paid to Qualifying JurisdictionsResident estates and full or part-year resident trusts only1. Connecticut taxable income ............................................ 1.Enter name of each qualifying jurisdiction. .....................2. Non-Connecticut income included on Line 1 above ....... 2.3. Divide Line 2 by Line 1 (may not exceed 1.0000). ........ 3. . .4. Connecticut tax liability .................................................. 4.5. Multiply Line 3 by Line 4. .............................................. 5.6. Income tax paid to a qualifying jurisdiction .................... 6.7. Enter the lesser of Line 5 or Line 6. ................................7.Column AColumn B8. Total Credit: Add the amount on Line 7 for each column. ..................................... 8..00Income tax paid means the lesser of the tax liability to thatjurisdiction or the tax the trust or estate paid to that jurisdiction,excluding any penalty or interest, as reported on a return filedwith that jurisdiction. Do not report taxes withheld for thequalifying jurisdiction.Part-Year Resident TrustEnter the total amount of income tax paid to a qualifyingjurisdiction for the period of Connecticut residency only.Income tax paid means the lesser of the trust’s tax liabilityto the qualifying jurisdiction or the tax the trust paid to thatjurisdiction, excluding any penalty or interest, as reported on areturn filed with that jurisdiction. Do not report taxes withheldfor the qualifying jurisdiction.If the tax the trust paid to that jurisdiction was also based onincome earned during the nonresidency period, prorate theamount of tax for which you are claiming credit. The prorationis based upon the relationship that the income earned in thatjurisdiction during the period of Connecticut residency bears tothe total amount of income the trust earned in that jurisdictionin the taxable year.Example: Taxpayer H, a part-year resident trust, conductedbusiness in Rhode Island all year and paid $1,200 in RhodeIsland tax in 2009. The trust’s total Rhode Island income for2009 was $20,000 of which $15,000 was earned while thetrust was a Connecticut resident trust. The income tax paid toRhode Island during the Connecticut residency period is:$15,000$20,000X $1,200 = $900The fiduciary of this trust should enter $900 on Line 6.Line 7Enter the lesser of Line 5 or Line 6.Line 8 - Total Credit for Income Taxes Paid toQualifying JurisdictionsAdd the amounts from Line 7A, Line 7B, and Line 7 ofany additional worksheets. The amount on Line 8 cannotexceed the amount on Line 5. Enter the total here and onForm CT-1041, Line 4.Attach a copy of the income tax return filed with eachqualifying jurisdiction to the Connecticut income tax returnor the credit will be disallowed.Connecticut Fiduciary AdjustmentUse Schedule A to compute the Connecticut fiduciaryadjustment, which is then allocated among the trust or estateand its beneficiaries in Schedule CT-1041B, Part 1. Thefiduciary adjustment is the net amount of the additions andsubtractions enumerated on Schedule A, which relate to itemsof income, gain, loss, or deduction of the trust or estate.Amount Paid or Set Aside for Charitable PurposesWhen calculating the fiduciary adjustment on Schedule A,do not include the modifications for any amount paid orset aside for a charitable purpose during the taxable year.See instructions for federal Form 1041-A, U.S. InformationReturn Trust Accumulation of Charitable Amounts, andfederal Form 5227, Split-Interest Trust Information Return,for information on charitable deductions.Member of a Pass-Through EntityIf the trust or estate has income as a member of a pass-throughentity, any additions or subtractions that apply to the incomeshould be included on Schedule A. You may obtain the trust’sor estate’s share of the entity’s items from Schedule CT K-1,Member’s Share of Certain Connecticut Items.Page 17

Beneficiary of Another Trust or EstateIf the trust or estate is a beneficiary of another trust or estate,you may generally obtain the share of the fiduciary adjustmentof the other trust or estate to be included on Schedule A fromits fiduciary.The trust or estate must make the additions and subtractionsfor its taxable year within which the taxable year of anyS corporation, partnership, or trust or estate of which it is ashareholder, partner, or beneficiary, respectively, ends.Entering Additions and SubtractionsEnter on Line 11 any expense related to the amounts enteredon Schedule A, Lines 1 through 4, to the extent deductible indetermining federal taxable income prior to the deductionsrelated to distributions to beneficiaries. Do not net the expensesagainst the amounts entered on Lines 1 through 4.Enter on Line 5 any expense related to the amounts enteredon Schedule A, Lines 7 through 10, to the extent deductiblein determining federal taxable income prior to the deductionsrelated to distributions to beneficiaries. Do not net the expensesagainst the amounts entered on Lines 7 through 10.Example: To the extent deductible in determining federaltaxable income prior to the deductions relating to distributionsto beneficiaries, interest expenses on indebtedness incurredto purchase:1. State and local government bonds, the interest from whichis subject to Connecticut income tax but exempt fromfederal income tax, is entered on Line 11 and not nettedagainst the amount entered on Line 1.2. U.S. government bonds, the interest from which is subjectto federal income tax but exempt from Connecticut incometax, is entered on Line 5 and not netted against the amountentered on Line 7.Instructions for Schedule ASee Policy Statement 2005(2), Connecticut Income Tax onBonds or Obligations Issued by the United States Government,by State Governments, or Municipalities, to determine if youare required to make an adjustment.Additions to Federal Taxable IncomeEnter all amounts as positive numbers.Line 1 - Interest on State and Local GovernmentObligations Other Than ConnecticutEnter the total amount of interest income derived from stateand municipal government obligations, other than obligationsof the State of Connecticut or its municipalities, which is nottaxed for federal income tax purposes. Do not enter interestincome derived from government obligations of Puerto Rico,Guam, American Samoa, or U.S. Virgin Islands.Line 2 - Exempt-Interest Dividends ReceivedFrom a Mutual Fund Derived From State orMunicipal Government Obligations Other ThanConnecticutEnter the total amount of exempt-interest dividends receivedfrom a mutual fund derived from state and municipalgovernment obligations other than obligations of the Stateof Connecticut or its municipalities. If the exempt-interestdividends are derived from obligations of Connecticut or otherstates, enter only the percentage derived from non-Connecticutobligations. Do not enter exempt-interest dividends derivedfrom government obligations of Puerto Rico, Guam, AmericanSamoa, or U.S. Virgin Islands.Example: A fund invests in obligations of many states,including Connecticut. Assuming that 20% of the distributionis from Connecticut obligations, the remaining 80% wouldbe added back on Line 2.Line 3 - Loss on Sale of Connecticut State andLocal Government BondsEnter the total amount of losses from the sale or exchange ofnotes, bonds, or other obligations of the State of Connecticutor its municipalities.Line 4 - Connecticut Income Tax PaymentsDeducted in Determining Federal TaxableIncomeAdd back any Connecticut income tax paid or accrued to theextent deductible in determining federal taxable income priorto deductions relating to distributions to beneficiaries.Line 5 - OtherUse Line 5 to add back any:1. Expenses paid or incurred for the production (includingmanagement, conservation, and maintenance of propertyheld for the production) or collection of income exemptfrom Connecticut income tax to the extent deductible indetermining federal taxable income prior to deductionsrelating to distributions to beneficiaries;2. Amortizable bond premium on bonds producing interestincome exempt from Connecticut income tax to the extentdeductible in determining federal taxable income prior todeductions relating to distributions to beneficiaries;Page 18

3. Interest or dividend income on obligations or securities ofany authority, commission, or instrumentality of the UnitedStates which federal law exempts from federal income taxbut does not exempt from state income taxes;4. Interest expenses on indebtedness incurred or continued topurchase or carry obligations or securities, the income fromwhich is exempt from Connecticut income tax, to the extentdeductible in determining federal taxable income prior todeductions relating to distributions to beneficiaries; or5. Domestic production activity deduction (I.R.C. §199).This modification is allowed to the extent the amount isdeductible in determining federal taxable income prior todeductions relating to distributions to beneficiaries.Line 6 - Total AdditionsAdd Lines 1 through 5.Subtractions From Federal Taxable IncomeEnter all amounts as positive numbers.Line 7 - Interest on U.S. Government ObligationsEnter the total of any interest income (to the extent includablein federal taxable income) derived from U.S. governmentobligations which federal law prohibits states from taxing (forexample, U.S. government bonds such as Savings Bonds SeriesEE and Series HH or U.S. Treasury bills and notes).Do not enter the amount of interest earned on Federal NationalMortgage Association (Fannie Mae) bonds, GovernmentNational Mortgage Association (Ginnie Mae) bonds, andFederal Home Loan Mortgage Corporation (Freddie Mac)securities. Federal law does not prohibit states from taxinginterest income derived from these obligations and this interestincome is taxable for Connecticut income tax purposes. Donot enter the amount of interest paid to you on any federalincome tax refund.Line 8 - Exempt Dividends From Certain MutualFunds Derived From U.S. Government ObligationsEnter the total amount of exempt dividends received froma qualifying mutual fund derived from U.S. governmentobligations. A mutual fund is a qualifying fund if, at the closeof each quarter of its taxable year, at least 50% of the valueof its assets consists of U.S. government obligations. Thepercentage of dividends that are exempt dividends should bereported to you by the mutual fund. See Line 7 instructionsabove.Line 9 - Gain on Sale of Connecticut State and LocalGovernment BondsEnter the total amount of all gains from the sale or exchange ofnotes, bonds, or other obligations of the State of Connecticutor its municipalities.Line 10 - Refunds of Connecticut Income TaxEnter the amount of taxable refunds of Connecticut incometax reported on federal Form 1041, Line 8.Line 11 - OtherTo the extent not deductible in determining federal taxableincome prior to deductions relating to distributions tobeneficiaries, use Line 11 to subtract:• Any interest paid on indebtedness incurred to acquireinvestments that provide income taxable in Connecticutbut not taxable for federal purposes;• Expenses paid or incurred for the production (includingmanagement, conservation, and maintenance of propertyheld for production) or collection of income taxable inConnecticut but exempt from federal income tax;• Any amortizable bond premium on bonds that provideinterest income taxable in Connecticut but exempt fromfederal income tax; or• Any interest income from notes, bonds, or other obligationof the State of Connecticut included in federal adjustedgross income. This modification includes any BuildAmerica Bond tax credit amount if the Build AmericaBond, as described in Section 1531 of the AmericanRecovery and Reinvestment Act of 2009, was issued by theState of Connecticut or a Connecticut political subdivisionand only to the extent the credit amount is treated asinterest includible in gross income for federal income taxpurposes.Do not use Line 11 to subtract income subject to tax in anotherjurisdiction. See Worksheet for Credit for Income Taxes Paidto Qualifying Jurisdictions, Line 4, on Page 17.Line 12 - Total SubtractionsAdd Lines 7 through 11.Line 13 - Connecticut Fiduciary AdjustmentSubtract Line 12 from Line 6. Enter here and on ScheduleCT-1041B, Part 1, Line f, Column 5. This amount may bepositive or negative.If you have a Connecticut fiduciary adjustment, completeSchedule CT-1041B, Part 1, to calculate the trust or estate’sand each beneficiary’s share of the Connecticut fiduciaryadjustment.Schedule CT-1041B, Part 2, should only be completed byfull-year resident or part-year resident inter vivos trusts withany nonresident, noncontingent beneficiaries to calculate thepercentage of resident, noncontingent beneficiaries. The statusof the beneficiaries is determined as of year end.Form CT-1041, Questions A, B, and CThe fiduciary must complete Form CT-1041, QuestionsA, B, and C. All inter vivos trusts claiming a resident,noncontingent beneficiary percentage on ScheduleCT-1041B, Part 2, must complete Form 1041, Question A, orthis percentage could be disallowed.Page 19

Instructions for Schedule CT-1041BPart 1 - Shares of Connecticut FiduciaryAdjustmentPart 1 shows the distribution of the Connecticut fiduciaryadjustment among the beneficiaries and the trust or estate.The shares of the beneficiaries and of the trust or estate inSchedule A, Connecticut Fiduciary Adjustment, Line 13, ofForm CT-1041 are in proportion to their respective shares offederal distributable net income of the trust or estate.Report on Part 1 the names and addresses of all beneficiaries,both resident and nonresident, to whom income is distributablewhether or not the income is taxable to the nonresidentbeneficiaries. Complete this section even if there is nodistribution to the beneficiaries.Columns 1 and 2Enter the name, address, and identifying number of eachbeneficiary of the trust or estate. If the mailing addressdiffers from the home address, give both. If a beneficiary isa nonresident, check the appropriate box to the right of thebeneficiary’s name. If there are more than four beneficiaries,attach a schedule identical to Part 1 for the additionalbeneficiaries.Column 3Enter the respective share of federal distributable net incomeof each beneficiary and of the trust or estate on the appropriatelines. Entries must be made for all resident and nonresidentbeneficiaries.If the distributable net income of a trust or estate for thetaxable year is zero or less than zero, each beneficiary’s sharein the Connecticut fiduciary adjustment is in proportion tothat beneficiary’s share of the income of the trust or estatefor the taxable year and any other amounts properly paid orcredited or required to be distributed during the taxable year.Any balance of the fiduciary adjustment not allocable to anybeneficiary is allocated to the trust or estate.Column 4Determine the percentage interest of each beneficiary and ofthe trust or estate in federal distributable net income of thetrust or estate based upon amounts in Column 3. Enter thatpercentage on the appropriate line of Column 4.Column 5Enter the amount of the Connecticut fiduciary adjustmentfrom Schedule A, Line 13, as the total on Line f,Column 5. The share of each beneficiary and of the trust orestate in the total amount is determined by multiplying thetotal fiduciary adjustment by the Column 4 percentage.If the trust or estate has no federal distributable net income,each beneficiary’s share in the fiduciary adjustment mustbe in proportion to his or her share of the trust or estateincome for the taxable year under local law or the governinginstrument, which is required to be distributed currently,and any amounts of the income distributed during the year.Any balance of the fiduciary adjustment not allocable tobeneficiaries must be allocated to the trust or estate. If theshares in the Connecticut fiduciary adjustment are apportionedin accordance with this paragraph, show the apportionment ina schedule attached to the return.The fiduciary must provide each beneficiary with a scheduleof modifications to include on Schedule 1 of Form CT-1040or Form CT-1040NR/PY.Part 2 - Percentage of Resident‚ NoncontingentBeneficiariesComplete Part 2 to calculate the resident, noncontingentbeneficiary percentage of a full-year resident or part-yearresident inter vivos trust with nonresident, noncontingentbeneficiaries. These trusts are taxed on income derived fromor connected with sources within Connecticut and all otherincome earned during the period of residency multiplied by theresident, noncontingent beneficiary percentage. The percentageis a fraction. The numerator is the total number of resident,noncontingent beneficiaries and the denominator is the sum ofboth resident, noncontingent and nonresident, noncontingentbeneficiaries. An example follows the line instructions. For anexplanation of inter vivos trust and noncontingent beneficiary,see Defi nitions on Page 5.Line 1Enter the number of resident, noncontingent beneficiariesif any.Line 2Enter the number of nonresident, noncontingentbeneficiaries.Line 3Add Line 1 and Line 2.Line 4Divide Line 1 by Line 3 and enter the result as a decimal.Round to four decimal places.If the trust is a full-year resident inter vivos trust, enter thisdecimal on Schedule CT-1041C, Line 11.If the trust is a part-year resident inter vivos trust, enter thisdecimal on Schedule CT-1041FA, Part 1, Line 5.Page 20

Example: Mr. Jones, a Connecticut resident, establishedan irrevocable trust in 2002 for the benefit of his threegrandchildren, Beneficiaries A, B, and C. Since the trustconsists of property transferred from a Connecticutresident, the trust is considered a resident trust. Becausethe trust was not created by the will of the decedent, thetrust is an inter vivos trust. The trust agreement permitsthe trustee to distribute income or corpus, or both, to allthree beneficiaries during the year. This makes all threebeneficiaries noncontingent beneficiaries. BeneficiariesA and B are Connecticut residents, but Beneficiary C is aVermont resident. Since there are one or more nonresident,noncontingent beneficiaries, the fiduciary of this trustmust complete Schedule CT-1041B, Part 2, as follows:1. Indicate the number of residentnoncontingent beneficiaries, if any. 22. Indicate the number of nonresidentnoncontingent beneficiaries. 13. Add Lines 1 and 2. 34. Divide Line 1 by Line 3 and enter decimalto four places. 0.6667The decimal on Line 4, rounded to four decimal places, isentered on Schedule CT-1041C, Line 11.If the trust in the example is a part-year resident trust, theamount on Line 4 is entered on Schedule CT-1041FA,Part 1, Line 5.Instructions for Schedule CT-1041CVerify line references from federal Form 1041 at the time youcomplete this schedule.Resident estates or full-year resident trusts must complete thisschedule to calculate Connecticut taxable income.Resident estates or full year resident trusts with nonresidentbeneficiaries must complete and attach Connecticut ESBTworksheet, if applicable.Resident Trust or Estate With or WithoutNonresident BeneficiariesEach resident estate or full-year resident trust, except forQuick-Filers, must select the applicable box pertaining to thestatus of its beneficiaries. Inter vivos trusts with nonresident,noncontingent beneficiaries calculate Connecticut taxableincome differently than other trusts. See Connecticut TaxableIncome for Certain Inter Vivos Trusts on Page 7.Type of Trust or EstateLine 1Resident trust or estate without nonresident beneficiaries:Check the box and complete Lines 4 through 6 andLine 14.Line 2Resident estate or a resident testamentary trust with oneor more nonresident beneficiaries or an inter vivos trustwith nonresident, contingent beneficiaries but withoutnonresident, noncontingent beneficiaries: Check the box,complete Schedule CT-1041FA, Parts 3 and 2, and completeLines 4 through 6 and Line 14.Line 3Resident inter vivos trust with one or more nonresident,noncontingent beneficiaries: Check the box and completeSchedule CT-1041FA, Parts 2 and 3. Then complete Lines 4through 14.Line 4 - Federal Taxable IncomeEnter the amount of federal taxable income from federalForm 1041, Line 22, and federal ESBT taxable income.Attach federal ESBT worksheet.Line 5 - Trust or Estate’s Share of ConnecticutFiduciary AdjustmentEnter the fiduciary’s share of the Connecticut fiduciaryadjustment from Schedule CT-1041B, Part 1, Line e,Column 5. This may be a positive or negative number.Line 6 - Connecticut Gross Taxable Income asModifiedAdd Line 4 and Line 5.Full-year resident inter vivos trusts with one or morenonresident, noncontingent beneficiaries, complete Lines 7through 14. All others go to Line 14.Line 7 - Trust or Estate’s Share of Income FromConnecticut SourcesEnter the trust or estate’s share of income derived from orconnected with sources within Connecticut from ScheduleCT-1041FA, Part 2, Line e, Column 3, and ConnecticutESBT worksheet. Attach Connecticut ESBT worksheet.Line 8aEnter the amount from Schedule CT-1041FA, Part 3, Line 4,Column B.Line 8bEnter the amount from Schedule CT-1041FA, Part 3, Line 18,Column B.Line 8cSubtract Line 8b from Line 8a.Line 9 - Income From Connecticut Sources asModifiedAdd Line 7 and Line 8c.Page 21

Line 10 - Connecticut Taxable Income FromNon-Connecticut Sources as ModifiedSubtract Line 9 from Line 6.Line 11 - Percentage of Resident, NoncontingentBeneficiariesEnter the decimal, rounded to four places, from ScheduleCT-1041B, Part 2, Line 4.Line 12 - Connecticut Taxable Portion ofNon-Connecticut-Sourced IncomeMultiply Line 10 by Line 11.Line 13 - Connecticut Taxable Income of a ResidentInter Vivos Trust With One or More Nonresident,Noncontingent BeneficiariesAdd Line 9 and Line 12.Line 14 - Connecticut Taxable IncomeIf the taxpayer is a resident inter vivos trust with one or morenonresident, noncontingent beneficiaries, enter the amountfrom Line 13. Otherwise, enter the amount from Line 6.The amount on Line 14 must also be entered on FormCT-1041, Line 1.Instructions for Schedule CT-1041FAVerify line references from federal Form 1041 at the time youcomplete this schedule.Connecticut ESBT worksheet, if applicable, and ScheduleCT-1041FA must be completed and attached to FormCT-1041 filed for a:1. Nonresident trust or estate having income derived from orconnected with sources within Connecticut;2. Part-year resident trust;3. Resident trust or estate with a nonresident beneficiary; or4. Resident inter vivos trust with one or more nonresident,noncontingent beneficiaries.The amount entered on Line c includes the trust or estate’sshare of distributable net income and certain gains derivedfrom or connected with Connecticut sources for the residencyand nonresidency portions of the taxable year. The share for theresidency portion of the taxable year may include income notfrom Connecticut sources. If so, complete Lines d through ito determine the amount to be subtracted from the amountentered on Line c.To determine the Connecticut taxable income of the trust orestate from Connecticut sources, complete the worksheetbelow.Refer to the front page of Schedule CT-1041FA to determinewhich parts must be completed and in what order.Part 1 - Computation of Connecticut Tax ofa Nonresident Estate or Trust and Part-YearResident TrustLine 1 - Federal Taxable IncomeEnter the federal taxable income from federal Form 1041,Line 22, and federal ESBT worksheet. Attach federalEBST worksheet.Line 2 - Trust or Estate’s Share of ConnecticutFiduciary AdjustmentEnter the amount from Schedule CT-1041B, Part 1, Line e,Column 5. This may be a positive or negative number.Line 3 - Gross Taxable Income as ModifiedAdd Line 1 and Line 2.Line 4 - Connecticut Taxable Income FromConnecticut SourcesPart-year resident inter vivos trusts with nonresident,noncontingent beneficiaries complete Lines a through i ofSchedule CT-1041FA-Line 4 Worksheet. All others, enterSubtotal from Line c on Schedule CT-1041FA, Part 1,Line 4, and Connecticut ESBT worksheet and go toLine 9 of Schedule CT-1041FA. Attach Connecticut ESBTworksheet.Schedule CT-1041FA - Line 4 Worksheeta. Trust or estate’s share of income fromConnecticut sources from ScheduleCT-1041FA, Part 2, Line e, Column 3,and federal EBST worksheet.b. Subtract the amount on ScheduleCT-1041FA, Part 3, Line 18, Column B, fromthe amount on Part 3, Line 4, Column B.Enter result here.c. Subtotal: Add Line a and Line b.d. Enter the portion of the amount onSchedule CT-1041FA, Part 3, Line 24,Column B, that was non-Connecticutsourcedincome during the residencyportion of the taxable year.e. Enter the percentage from ScheduleCT-1041B, Part 1, Line e, Column 4.f. Multiply Line d by Line e.g. Enter the portion of Line b that wasnon-Connecticut-sourced income duringthe residency portion of the taxable year.h. Subtotal: Add Line f and Line g.i. Total: Subtract Line h from Line c andenter the result here and on ScheduleCT-1041FA, Part 1, Line 4..00.00.00Page 22

Complete Lines 5 through 8 only for part-year resident intervivos trusts with nonresident, noncontingent beneficiaries.Line 5 - Percentage of Resident, NoncontingentBeneficiariesEnter the decimal rounded to four places from ScheduleCT-1041B, Part 2, Line 4.Line 6 - Connecticut Taxable Income FromNon-Connecticut Sources During the ResidencyPortion of the Taxable Year as ModifiedEnter the amount from Schedule CT-1041FA - Line 4 Worksheet,Line h, on Page 22.Line 7 - Connecticut Taxable Portion ofNon-Connecticut-Sourced IncomeMultiply Line 6 by Line 5 and enter the result.Line 8 - Connecticut Taxable Income of a Part-YearResident Inter Vivos Trust With Nonresident‚Noncontingent BeneficiariesAdd Line 4 and Line 7.Line 9For a part-year resident inter vivos trust with nonresident,noncontingent beneficiaries, enter the amount from Line 8.Otherwise, enter the greater of Line 3 or Line 4.Line 10 - Connecticut Income TaxMultiply Line 9 by 6.5% and enter the result. If Line 9 iszero or less, enter “0.”Line 11Part-year resident inter vivos trusts with one or morenonresident, noncontingent beneficiaries:• If Line 9 is greater than zero, enter 1.0000.• If Line 9 is zero or less, enter “0.”All others:• If Line 4 is greater than zero and Line 4 is greater than orequal to Line 3, enter 1.0000.• If Line 4 is greater than zero and less than Line 3, divideLine 4 by Line 3 and enter the result as a decimal. Roundto four decimal places.• If Line 4 is zero or less, enter “0.”Line 12 - Allocated Connecticut TaxMultiply Line 10 by Line 11. Enter the result here and onForm CT-1041, Line 3.Part 2 - Trust or Estate’s and Beneficiary’sShare of Income From Connecticut SourcesThe federal distributable net income derived from or connectedwith sources within Connecticut (Part 3, Line 24, Column B)is allocated in Part 2 to the trust or estate and its beneficiariesin proportion to their respective shares in the federaldistributable net income of the trust or estate. Do not completePart 2 if Part 3, Line 24, Column B, is zero.Columns 1 and 2Using Schedule CT-1041B, Part 1, Columns 3 and 4, enter therespective amount and percentage of federal distributable netincome of each beneficiary and of the trust or estate on theappropriate lines of Columns 1 and 2. List beneficiaries in thesame order as used on Schedule CT-1041B, Part 1, Column 1.The entries on Schedule CT-1041B, Part 1, Columns 3and 4, and Schedule CT-1041FA, Part 2, Columns 1 and 2,are identical.For resident beneficiaries, their entire distributable shareof trust or estate income, not just the portion derived fromor connected with Connecticut sources, is included in theirConnecticut adjusted gross income.Column 3Enter on the Total line of Column 3 the amount entered onPart 3, Line 24, Column B.Determine the share of each nonresident beneficiary or ofthe trust or estate of a nonresident estate or trust or part-yearresident trust in the total amount by multiplying the total inColumn 3 by the percent in Column 2. For part-year residenttrusts, the amounts in Column 3 for nonresident beneficiariesshould not include amounts received during the residencyportion of the taxable year not derived from or connected withsources within Connecticut.The fiduciary must provide each nonresident beneficiarywith a schedule of income derived from or connected withsources within Connecticut to include on his or her FormCT-1040NR/PY, Schedule CT-SI, Nonresident or Part-YearResident Schedule of Income From Connecticut Sources.Part 3 - Details of Federal Distributable NetIncome and Amounts of Income DerivedFrom or Connected With Sources WithinConnecticutEnter in Column A the amount reported on federal Form 1041as modified for the applicable items reported on Schedule A.For information on federal amounts which may be modified,such as the gain or loss on the sale of Connecticut state andlocal government bonds, see Instructions for Schedule Aon Page 18. Enter in Column B the portion of each amountin Column A that is income or deductions derived from orconnected with sources within Connecticut.Passive Activity Loss LimitationsIn completing Column B, recompute any deduction for passiveactivity losses to determine the amounts that would be allowedif the federal taxable income took into account only items ofincome, gain, loss, or deduction of income derived from orconnected with sources within Connecticut.Part-Year Resident Trusts OnlyFor a part-year resident trust, include in Column B all incomeduring the residency portion of the taxable year and all incomederived from or connected with sources within ConnecticutPage 23

during the nonresidency portion of the taxable year. If the trustwas a part-year resident trust, include in Column B all itemsof special accruals. See Special Accruals on Page 8.Part-year resident inter vivos trusts with one or more nonresident,noncontingent beneficiaries should create a worksheet forSchedule CT-1041FA, Part 3, Column B. This worksheetshould indicate the amount from Column B attributable tonon-Connecticut-sourced income during the residency portionof the taxable year. Use this determination to complete theworksheet for Schedule CT-1041FA, Part 1, Line 4.Line 1 and Line 2 - Interest Income andDividendsReport on Line 1 and Line 2, Column B, income from interestand dividends included in Column A from a trade or businesscarried on in Connecticut. Also include amounts which relateto items of income, gain, loss, or deduction of the trust or estatederived from or connected with sources within Connecticut.Include in Column A and, if applicable, Column B intereston state and local obligations other than Connecticut andexempt-interest dividends on state and local obligations otherthan Connecticut.However, do not include in Column A or Column B any incomeexempt from state taxes under the laws of the United Statesor of Connecticut, such as interest on U.S. government bondsor dividends from qualifying mutual funds derived from U.S.government obligations. A mutual fund is a qualifying fund ifat the close of each quarter of its taxable year at least 50% of thevalue of its assets consists of U.S. government obligations.Line 3 - Business Income (Loss)Enter in Column B the net income (loss) from a trade orbusiness carried on in Connecticut by the trust or estate. Ifbusiness is carried on both within and outside of Connecticutand the Connecticut income can be adequately determinedfrom the books and records of the business, enter on Line 3,Column B, the net income (loss) from business carried on inConnecticut. If the Connecticut income cannot be adequatelydetermined from the books and records of the business, refer toSchedule CT-1040BA‚ Nonresident Business Apportionment‚for instructions on how to determine the portion related to theConnecticut business operations. This form is available on theDRS website at www.ct.gov/DRS.Line 4 - Capital Gain (Loss)Enter in Column B the amount of capital gain (loss) fromincome derived from or connected with sources withinConnecticut.Line 5 - Rents, Royalties, Pass-Through Entities(Partnerships, S Corporations), and Other Trustsand EstatesInclude in Column B net rents and royalties from:1. Real property situated in Connecticut whether or not usedin or connected with a business;2. Tangible personal property not used in or connectedwith a business if the property has an actual location inConnecticut; and3. Tangible and intangible personal property used in orconnected with a trade or business carried on in Connecticutby the trust or estate.If the estate or trust received a federal Schedule K-1 anda Schedule CT K-1 from a partnership, S corporation, orother pass-through entity, use the corresponding lines onForm CT-1041FA to report the income from the pass-throughentity (for example, interest, dividends, capital gains).Line 6 - Farm Income (Loss)Enter in Column B the net income (loss) from farmingcarried on in Connecticut by the trust or estate. If farmingis carried on both within and outside of Connecticut and theConnecticut income can be adequately determined from thebooks and records of the farm, enter on Line 6, Column B,the net income (loss) from farming carried on in Connecticut.If the Connecticut income cannot be adequately determinedfrom the books and records of the farm, refer to ScheduleCT-1040BA for instructions on how to determine the portionrelated to the Connecticut business operations.Line 7 - Ordinary Gain (Loss)Enter in Column B the amount of any ordinary gain (loss) fromfederal Form 4797 derived from or connected with sourceswithin Connecticut.Line 8 - Other IncomeEnter in Column B any income derived from or connectedwith sources within Connecticut not reportable elsewherein Part 3.Line 9Add Lines 1 through 8.Lines 10 through 14Enter in Column B only that portion of each item of deductionreported in Column A that relates to income derived from orconnected with sources within Connecticut as reported inColumn B on Lines 1 through 8.Line 15Enter on Line 15, Column A, the deduction allowed to trustsand estates under I.R.C. §642(b). Use the following calculationto determine the amount of the §642 deduction to be reportedon Line 15, Column B:Line 15, Part 3, Line 9, Column B Line 15,= xColumn B Part 3, Line 9, Column A Column ALine 16Add Lines 10 through 15.Page 24

Line 17 - Adjusted Total Income (Loss)Subtract Line 16 from Line 9 and enter the result.For Lines 18 through 24, enter in Column B only that portionof Column A that relates to Connecticut sources.Line 18Enter on Line 18, Column A, the amount from federalForm 1041, Schedule D, Line 15(1).Line 19Enter on Line 19, Column A, the amount from federalForm 1041, Schedule A, Line 1 (long term and short termcapital gain portion only).Line 20Enter on Line 20, Column A, the amount from federalForm 1041, Schedule A, Line 4.Line 21If the amount on Line 4 of this schedule is a loss, enter thatamount on Line 21, Column A, as a positive figure. Otherwise,enter “0.”Line 22Add Lines 17 through 21.Line 23If Line 4 of this schedule is a gain, enter that amount.Otherwise, enter “0.”Line 24 - Distributable Net IncomeSubtract Line 23 from Line 22. Enter the amount fromPart 3, Line 24, Column B, on Part 2, Total line, Column 3.Electronic Filing! Free and secure!Page 25

Use Form CT-1041 to amend a previously-filed Connecticutincome tax return for trusts and estates. Check the AmendedReturn box on the front of Form CT-1041. Enter the amountpaid with the original return on Line 12. If an amendedForm CT-1041 is filed to have an overpayment of Connecticutincome tax refunded or credited, it must be filed before theConnecticut statute of limitations expires. Generally, theConnecticut statute of limitations for refunding or creditingany Connecticut income tax overpayment expires three yearsafter the due date of the return, but if a timely request forAmended Returnan extension of time to file a return was filed, the statute oflimitations expires three years after the extended due dateof the return or three years after the date of filing the return,whichever is earlier. If an amended return is not timely filed,a penalty may be imposed. If additional tax is due, interestwill apply. See Interest and Penalties on Page 11.Do not file an amended Form CT-1041 to have anoverpayment refunded instead of applied to next year’sestimated tax. The elections you made on the original returncannot be changed by filing an amended Form CT-1041.The following circumstances require the filing of an amended Form CT-1041. Attach a statement explaining the reasonfor filing an amended return.1. The IRS or federal courts change or correctthe federal income tax return and the changeor correction results in the trust’s or estate’sConnecticut income tax being overpaid orunderpaid.2. The fiduciary of the trust or estate filed atimely amended federal income tax return and theamendment results in the Connecticut income taxbeing overpaid or underpaid.3. The fiduciary claimed a credit for income taxpaid to a qualifying jurisdiction on the originalincome tax return and the tax officials or courtsof that qualifying jurisdiction made a change orcorrection to the income tax return and the changeor correction results in the Connecticut incometax being overpaid or underpaid by increasing ordecreasing the amount of the allowable credit.4. The fiduciary claimed a credit for income taxpaid to a qualifying jurisdiction on the originalincome tax return and the fiduciary filed atimely amended income tax return with thatqualifying jurisdiction and the amendment resultsin the Connecticut income tax being overpaid orunderpaid by increasing or decreasing the amountof the allowable credit.5. None of the above circumstances apply, butthe fiduciary made a mistake or omission on theConnecticut income tax return and the mistake oromission results in the Connecticut income taxbeing overpaid or underpaid.File no later than 90 days after the final determination. If the fiduciaryfiles an amended Form CT-1041 no later than 90 days after the finaldetermination, any Connecticut income tax overpayment resulting fromthe final determination will be refunded or credited to the trust or estateeven if the Connecticut statute of limitations has otherwise expired.File no later than 90 days after the date you filed a timely amendedfederal income tax return. If the fiduciary files an amendedForm CT-1041 no later than 90 days after the date of filing the timelyamended federal income tax return, any Connecticut income taxoverpayment resulting from filing the timely amended federal incometax return will be refunded or credited to the trust or estate even if theConnecticut statute of limitations has otherwise expired.File no later than 90 days after the final determination. If the fiduciaryfiles an amended Form CT-1041 no later than 90 days after the finaldetermination and the fiduciary claimed credit for income tax paid to aqualifying jurisdiction on the original income tax return, any Connecticutincome tax overpayment resulting from the final determination will berefunded or credited to the trust or estate even if the Connecticut statuteof limitations has otherwise expired.File no later than 90 days after the date you filed an amended returnwith the qualifying jurisdiction. If the fiduciary files an amended FormCT-1041 no later than 90 days after the final determination and thefiduciary claimed credit for income tax paid to a qualifying jurisdiction onthe original income tax return, any Connecticut income tax overpaymentresulting from the final determination will be refunded or credited to thetrust or estate even if the Connecticut statute of limitations has otherwiseexpired.File no later than three years after the due date of the return, or ifyou filed a timely request for an extension of time to file, three years afterthe date of filing the return or three years after the extended due date,whichever is earlier.Page 26

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Department of Revenue ServicesState of Connecticut25 Sigourney Street Ste 2Hartford CT 06106-5032DRS Is Going Green ... And So Can YouE-Filing Is Green FilingEliminate the use of paper and fuel used to transport returns through the mail. File and pay electronically instead. Visitwww.ct.gov/TSC to create an account and eliminate the paper clutter in your life.Connecticut tax filers can file most tax returns, extensions, and estimates using the Taxpayer Service Center (TSC) atwww.ct.gov/TSC for free.Greener Money With Direct DepositStop those paper checks and driving to the bank to deposit your Connecticut income tax refund by choosing direct deposit!A direct deposit refund when filing through TSC is the fastest way to get your tax refund into your account!Green Means Stop ... Receiving Paper ReturnsIf you file a paper return using commercial software or a tax practitioner, check the box to stop receiving a paper return.Mark your electronic calendar to remind you to purchase new software or contact your preparer.InternetTax InformationThe TSC includes a comprehensive FAQ database withmore than 600 searchable answers. Search by category,tax type, keyword, or phrase.Forms and PublicationsConnecticut forms and publications may beviewed, downloaded, or printed by visitingwww.ct.gov/DRS the DRS website.InternetPhoneEmailFor telephone assistance, call our Taxpayer ServicesDivision at 1-800-382-9463 (Connecticut calls outside theGreater Hartford calling area only); or 860-297-5962 (fromanywhere).Send routine tax questions to drs@po.state.ct.us (do notsend account related inquiries). For account-related questions,including bill and refund inquiries, use the Secure Mailboxfeature by logging into the DRS electronic TSC.1-800-382-9463 (Connecticut calls outsidethe Greater Hartford calling area only) andselect Option 2; or 860-297-4753 (fromanywhere).Email requests, including your name,address (street, city, state, and ZIP code), andthe name or number of the tax product toctforms.drs@po.state.ct.usPhone EmailWalk-InFree personal taxpayer assistance and forms are available by visiting our Hartford office at 25 SigourneyStreet, Hartford CT. Walk-in assistance is available Monday through Friday, 8:30 a.m. to 4:00 p.m.Directions to DRS Hartford office are available using our phone menu or visiting the DRS website. Ifyou require special accommodations, please advise the DRS representative.Federal Tax InformationFor questions about federal taxes, visit www.irs.gov orcall the Internal Revenue Service (IRS) at 1-800-829-1040.To order federal tax forms, call 1-800-829-3676.Statewide ServicesVisit the ConneCT website at www.ct.gov forinformation on statewide services and programs.Walk-In