2017 Minnesota Income Tax for Estates and Trusts ...

1 2017 Minnesota Income Tax for Estates and Trusts (Fiduciary) Form M2 Instructions What's New for 2017 Filing Requirements Questions? Federal Adjustments An estate or trust - regardless if it is consid- You can find forms and information, including ered a resident - must file Form M2 when: answers to frequently asked questions and Definitions used in determining Minnesota options for filing and paying electronically, on tax are based on the Internal revenue Code, 1. There is $600 or more of gross Income our website at: as amended through December 16, 2016. allocable to Minnesota ; or Since that date, the federal Disaster Tax 2.

2 There is a nonresident alien as a benefi- Send us an e-mail at: Relief and Airport and Airway Extension ciary. Act of 2017 (Pub. L. 115-63), Tax Cuts and [ 2]. Call us at 651-556-3075. Jobs Act (Pub. L. 115-97), and Bipartisan When required, the trustee of a trust or the Budget Act of 2018 (Pub. L. 115-123). personal representative of an estate is re- Need Forms? These laws contain a number of provisions sponsible for filing the Minnesota Form M2, Go to that may affect your Minnesota tax. See Income Tax Return for Estates and Trusts This information is available in alternate Federal Adjustments for Businesses on page (Fiduciaries) and for paying the tax.

3 Formats. 10-11 to determine if you need to adjust your return. Bankruptcy Estates . If the fiduciary of a bankruptcy estate of a Minnesota resident For Trusts that became irrevocable or Continue to check our website for further filed a federal return, a Minnesota return were first administered in Minnesota updates. must also be filed. Use Form M1, Individual before January 1, 1996: A resident trust, Accelerated Installment Sale Gains Income Tax Return, to determine the Min- except a grantor type trust, means any trust Beginning in tax year 2017, some nesota tax and attach it to Form M2. File it administered in Minnesota .

4 Nonresident individual taxpayers will in the same way you file federal returns. To be considered a resident trust adminis- be required to accelerate recognition of Resident Estates . An estate is considered a tered in Minnesota , you must meet two of installment sale gains if the sales involve S Minnesota estate if: the following three criteria: corporation stock or assets, or partnership the decedent was a resident of Min nesota A majority of the discretionary investment interests or assets. The new law applies to at the time of death, or decisions are made in Minnesota , sales that are executed by individuals, and the personal representative or fidu ciary The majority of discretionary distribution to sales that are executed by partnerships, S was appointed by a Minnesota court or decisions are made in Minnesota , and corporations, Trusts or Estates , and multi- the court administration was performed The trust's official books and records are tiered pass-through structures.

5 In Minnesota in other than an ancillary kept in Minnesota . A new checkbox has been added to Form pro ceeding. M2, and new lines have been added to [ , subd. 7b]. File the first Form M2 cov ering the period Schedule KF to ensure correct reporting to beneficiaries. from the date of the decedent's death to the end of the tax year. Be sure to check the box Before You File Federal Automatic Extension for Filing to indicate it is the fiduciary's initial return. Complete a Federal Return Before you complete Form M2, complete Minnesota Statute , subd. 7 was File subsequent returns for later years until amended to provide fiduciary Income tax federal Form 1041, Income Tax Return the end of the estate's ad ministration period.

6 For Estates and Trusts , and supporting filers an automatic and equivalent extension of the return filing deadline when a federal Resident Trusts . The definition of a resident schedules. You will need to reference them. extension is granted. The extension does not trust differs depending on the date be- Complete affect the due date for payment. The change fore or after December 31, 1995 the trust If you are a: federal Form: is effective for: becomes irrevocable or is first administered Charitable remainder (enter All 2017 calendar year filers (with year- in Minnesota . zero on Form M2, lines 1 and 9) .. 1041A. end of December 31, 2017) For Trusts that became irrevocable or or charitable lead trust.

7 Or 5227. Fiscal year filers with year-end of were first administered in Minnesota February 28, 2017 or after after December 31, 1995: A resident trust Designated or qualified settlement means a trust, except a grantor type trust, fund (under IRC section 468B) .. 1120-SF. Contents that either: Qualified funeral trust .. 1041-QFT. What's new ..1 1. was created by a will of a decedent who Electing small business trust (ESBT) . 1041. General information .. 1 3 at his or her death was a Minnesota resi- dent, or Filing requirements .. 1. Before you file .. 1 2. is an irrevocable trust, and at the time the Minnesota Tax ID Number Due dates and extensions.

8 2 Your Minnesota tax ID is the seven-digit trust became irrevocable, the grantor was Payment options .. 2 number you're assigned when you register a Minnesota resident. A trust is con- M2 line instructions .. 4 8 with the department. It's important to in- sidered irrevocable if the grantor is not Allocation of adjustments .. 9 clude your Minnesota tax ID on your return Federal adjustments .. 10 11 treated as the owner as defined in sections so that any payments you make are properly Tax tables .. 12 15 671 to 678 of the IRC. credited to your account. Continued1. General Information (continued). If you don't have a Minnesota tax ID, you must apply for one.

9 Go to and type Busi- Payment Options ness Registration on the search box or call If you administer 100 or more Trusts , you are required to pay all the fiduciary Income taxes 651-282-5225 or 1-800-657-3605. electronically. A 5 percent penalty will be assessed if you fail to do so when required. Due Dates and Pay electronically using e-Services To pay over the Internet go to , and click on Login to e- Extensions Services, or To pay by phone call 1-800-570-3329. Due Date for Filing and Both options are free and there's no need to preregister. If you're using Paying is April 17, 2018 the system for the first time and need a temporary password, call 651-282-5225 or 1-800-657-3605.

10 The regular due date for filing Form M2. and paying the tax due is April 17, 2018. To be timely, you must complete your transaction and receive a confirmation If you file your return according to a fiscal number on or before the due date for that payment. year, your return and payment are due the Pay by credit or debit card 15th day of the fourth month following the For a fee, you can use your credit or debit card to make a payment through Value Pay- end of the tax year. ment Systems, a national company that partners with federal, state and local govern- ments to provide credit and debit card payment services. Short-year returns are due by the 15th day of the fourth month following the month To do so: in which the short year ends.