Fillable Form 1041-ES (2021)

What is Form 1041-ES?

Form 1041-ES, Estimated Income Tax for Estates and Trusts, is a form for calculating the amount of estimated tax that must be paid by an estate or trust. The form is filed by a fiduciary, or a person entrusted with the management of the estate or trust.

Estimated tax is the method used to pay tax on income that isn’t subject to withholding, such as earnings from self-employment, interest, dividends, rents, and alimony. In addition, if a person does not choose voluntary withholding, they should make estimated tax payments on other taxable income such as unemployment compensation and the taxable portion of their social security benefits.

IRS Form 1041 ES is part of Section 1041 of the Internal Revenue Code (IRC), with the main purpose of declaring any and all taxable income generated by an estate or trust after the decedent (the deceased’s) passing, and before the estate or trust is passed to the decedent’s beneficiaries.

As with all kinds of tax, the estimated tax owed by estates and trusts that they must declare through the IRS 1041-ES form can be reduced due to tax deductions and capital losses. Any income made prior to the decedent’s date of death is reported on the decedent's final tax return, which is a separate document that the estate’s executor must file. Should any assets be passed on straight to the beneficiary without being held by any estate or trust, then those need not be declared in Form 1041-ES.

Similar to the estimated tax for individuals, while most estates and trusts will have to pay the estimated tax, there are certain conditions under which an estate or trust will be exempt from having to pay the tax. These exceptions are the following:

• An estate or trust has a full, 12-month tax year with no tax liabilities for that year.
• A decedent’s estate for any tax year ending before the date that is 2 years from the decedent’s passing

Who needs to use Form 1041-ES?

A fiduciary must file Form 1041-ES if, in addition to not meeting the above exceptions, the estate or trust they are representing is expected to owe at least $1000 dollars in tax after subtracting all withholding and credits, and can expect that the withholding and credits of the estate will be less than:

• 90% of the tax shown on their 2021 tax return
• The tax shown on the 2020 tax form. If the estate or trust’s Adjusted Gross Income (AGI) on that return was $150,000 or more, and less than ? of the AGI is from farming or fishing, then the withholding and credits of the estate should be less than 110% of this amount.

How to fill out Form 1041-ES?

Form 1041-ES is a very simple form to fill out. Make sure that you have all the documents relevant to the income and tax information of the estate or trust in order to ensure that you have the necessary information ready to enter in the form. Make sure to also consult the instructions and tips on pages 1 to 3 of the form should you need clarification on particular steps.

2021 Tax Computation Worksheet Using Maximum Capital Gains Rates

Use this computation worksheet if the estate or trust expects a net capital gain or qualified dividends and Line 6 of the 2021 Estimated Tax Worksheet is more than zero.

Line 1

Enter the taxable income as entered in Line 6 of the 2021 Estimated Tax Worksheet on page 5.

Line 2

Enter the total qualified dividends and net capital gain expected for 2021. Do not include any qualified dividends or capital gain from the disposition of property held for investment that you elected to include in investment income.

Line 3

Enter the 28% rate gain expected for 2021.

Line 4

Enter the unrecaptured section 1250 gain expected for 2021.

Line 5

Add lines 3 and 4, and enter the smaller amount between the sum or the amount written on Line 2.

Line 6

Subtract Line 5 from Line 2 and enter the difference. If zero or less, enter -0-.

Line 7

Subtract Line 6 from Line 1 and enter the difference. If zero or less, enter -0-.

Line 8

Enter the smaller amount between Line 1 or $2700.

Line 9

Enter the smaller amount between Line 7 or Line 8.

Line 10a

Subtract Line 2 from Line 1 and enter the difference. If the difference is zero or less, enter -0-.

Line 10b

Enter the smaller amount between Line 1 or $9550

Line 10c

Enter the smaller amount between Line 7 or Line 10b.

Line 11

Enter the larger amount between Line 10a or Line 10c.

Line 12

Enter the tax on the amount on Line 11 based on the 2021 Tax Rate Schedule on Page 5 of this form.

Important note: If the amounts on Line 8 and Line 9 are the same, skip lines 13 through 37 and go to Line 38.

Line 13

Enter the amount on Line 8

Line 14

Enter the amount on Line 7

Line 15

Subtract Line 14 from Line 13 and enter the difference. If the difference is zero or less, enter -0-.

Important note: If the amounts on Line 1 and 8 are the same, skip lines 16 through 37 and go to Line 38.

Line 16

Enter the smaller of Line 1 or Line 6

Line 17

Enter the amount from Line 15. If Line 15 is blank, enter -0-.

Line 18

Subtract Line 17 from Line 16 and enter the difference. If the difference is zero or less, enter -0-.

Line 19

Enter the smaller amount between line 1 or $13,250.

Line 20

Add lines 11 and 15 and enter the sum.

Line 21

Subtract Line 20 from Line 19 and enter the difference. If the difference is zero or less, enter -0-.

Line 22

Enter the smaller amount between Line 18 or Line 21.

Line 23

Multiply Line 22 by 15% (0.15) and enter the product.

Line 24

Enter the amount from Line 16.

Line 25

Add Lines 15 and 22 and enter the sum.

Line 26

Subtract Line 25 from Line 24 and enter the difference. If zero or less, enter -0-.

Line 27

Multiply Line 26 by 20% (0.20) and enter the product.

Important note: If Line 5 is zero or blank, skip lines 28 through 37 and go to Line 38.

Line 28

Enter the smaller amount between Line 2 or Line 4.

Line 29

Add Line 2 and Line 11 and enter the sum.

Line 30

Enter the amount from Line 1.

Line 31

Subtract Line 30 from Line 29 and enter the difference. If the difference is zero or less, enter -0-.

Line 32

Subtract Line 31 from Line 28 and enter the difference. If zero or less, enter -0-.

Line 33

Multiply Line 32 by 25% (0.25) and enter the product.

Important note: If line 3 is zero or blank, skip lines 34 through 37 and go to Line 38.

Line 34

Enter the amount from Line 1.

Line 35

Add Lines 11, 15, 22, 26, and 32 and enter the sum.

Line 36

Subtract Line 35 from Line 34 and enter the difference.

Line 37

Multiply Line 36 by 28% (0.28) and enter the product.

Line 38

Add Lines 12, 23, 27, 33, and 37 and enter the sum.

Line 39

Enter the tax on the amount on Line 1 from the 2021 Tax Rate Schedule on Page 5 of this form.

Line 40

Enter the smaller of line 38 or 39 here and on Line 7 of the 2021 Estimated Tax Worksheet.

2021 Estimated Tax Worksheet

Line 1

Enter adjusted total income expected in 2021.

Line 2

Enter any expected income distribution deduction.

Line 3

Enter any estate tax deduction.

Line 4

Enter any exemptions as outlined in the instructions for Line 4 on Page 1 of this form.

Line 5

Add lines 2, 3, and 4 and enter the sum.

Line 6

Subtract Line 5 from Line 1 and enter the difference. This is the taxable income of the estate or trust that will be entered in Line 1 of the 2021 Tax Computation Worksheet Using Maximum Capital Gains Rates above.

Line 7

Enter the amount on Line 40 of the 2021 Tax Computation Worksheet Using Maximum Capital Gains Rates.

Line 8

Enter the alternative minimum tax here.

Line 9

Add Line 7 and Line 8, as well as any tax on lump-sum distributions from Form 4972, and enter the sum.

Line 10

Enter the Credits as outlined in the instructions for Line 10 of the 2021 Tax Worksheet on Page 2 of this form.

Line 11

Subtract Line 10 from Line 9 and enter the difference. If the difference is zero or less, enter -0-.

Line 12

Enter any other taxes as outlined in the instructions for Line 12 of the 2021 Tax Worksheet on Page 2 of this form.

Line 13

Add lines 11 and 12, then reduce the sum by any credit you expect to claim on Form 4136, and enter the total amount. This is the estimated tax for 2021.

Line 14a

Enter 90% (0.90) of Line 13, or 66?% (0.67) for farmers and fishermen.

Line 14b

Enter the tax shown on the 2020 Form 1041. Enter 110% of that amount of the estate or trust’s AGI on that return is more than $150,000 and less than ? of gross income for 2020 or 2021 is from farming or fishing.

Line 14c

Enter the smaller amount between Line 14a or Line 14b.

Line 15

Enter the amount of income tax withheld and estimated to be withheld during 2021 and other refundable credits.

Line 16

Subtract Line 15 from Line 14c.

Important note: If Line 13 minus Line 15 is less than $1000, then the estate or trust isn’t required to make estimated tax payments.

Line 17

If the first required payment is due on April 15, 2021, enter ¼ of Line 16 minus any 2020 overpayments you are applying to this installment here and on the payment line of the voucher(s). You may round off cents to the nearest whole number.

Record of Estimated Tax Payments

Column A - Amount Due

Enter the amount of tax due by the corresponding deadline in this column.

Column B - Date Paid

Enter the dates that these tax payments were paid in this column.

Column C - Check or Money Order Number, or Credit Card or Debit Card Confirmation Number

Enter the number of the payment method you used to make each of the tax payments.

Column D - Amount Paid

Enter the amount paid. Do not include any convenience fees associated with payment.

Column E - 2020 Overpayment Credit Applied

Enter how much overpayment credit from 2020 was applied.

Column F - Total Amount Paid and Credited

Enter the total amount paid and credited here (sum of the corresponding row of columns D and E).

Total

Enter the totals of columns D, E, and F in the given spaces.

Payment Voucher(s)

You need only fill out these payment vouchers if the estate or trust is making a payment of estimated tax. Return this voucher with a check or money order payable to “United States Treasury”. Write the estate or trust’s EIN and 2021 Form 1041-ES on the check or money order. DO NOT SEND CASH. Enclose the payment with this voucher (do not staple or attach it to the voucher).

These instructions are applicable for all payment vouchers that must be filled out in this form.

Fiscal Year Filers - Year Ending

Enter the month and year that this payment voucher is being filed in.

Employer Identification Number

Enter the estate or trust’s Employer Identification Number (EIN).

Name of Estate or Trust

Enter the name of the estate or trust.

Name and Title of Fiduciary

Enter the full legal name and any important titles of the fiduciary.

Address of Fiduciary

Enter the fiduciary’s building number, street, and room or suite number.

City, State, and ZIP Code

Enter the city, state, and ZIP code of the fiduciary.

Tips when filling out Form 1041-ES

Form 1041-ES contains sensitive information regarding the finances of an estate or trust. Because of this, it is important to keep it in a safe and secure place in order to avoid issues.

Ensure that all information is updated and correct. This will help to avoid issues surrounding proper taxation and the legal consequences thereof. Make sure to double-check if you’ve entered everything correctly.

Practice good contract management. Create a copy of the fulfilled Form 1040-ES and keep it in a secure, organized area. This will be useful for backup or possible future legal uses.