Schedule K-1 (Form Beneficiary's Share of Income, Deductions, Credits, etc.

661106
Final K-1

Schedule K-1
(Form 1041)

2006

Department of the Treasury
Internal Revenue Service

Part III

For calendar year 2006,
or tax year beginning
and ending

Estate’s or trust’s employer identification number

B

Estate’s or trust’s name

D

1

Interest income

2a

Ordinary dividends

2b

Qualified dividends

3

Net short-term capital gain

4a

Net long-term capital gain

4b

28% rate gain

4c

Unrecaptured section 1250 gain

5

Other portfolio and
nonbusiness income

6

Ordinary business income

7

Net rental real estate income

8

Other rental income

9

Directly apportioned deductions

11

Final year deductions

12

Alternative minimum tax adjustment

13

Credits and credit recapture

14

Other information

Information About the Estate or Trust

A

C

OMB No. 1545-0092

, 2006
, 20

Beneficiary’s Share of Income, Deductions,
© See back of form and instructions.
Credits, etc.
Part I

Amended K-1

Beneficiary’s Share of Current Year Income,
Deductions, Credits, and Other Items

Fiduciary’s name, address, city, state, and ZIP code

Check if Form 1041-T was filed and enter the date it was filed

/

/

E

Check if this is the final Form 1041 for the estate or trust

F

Tax shelter registration number, if any

G

Check if Form 8271 is attached

10

Part II

Estate tax deduction

Information About the Beneficiary

H

Beneficiary’s identifying number

I

Beneficiary’s name, address, city, state, and ZIP code

J

Domestic beneficiary

Foreign beneficiary

For Paperwork Reduction Act Notice, see the Instructions for Form 1041.

For IRS Use Only

*See attached statement for additional information.
Note: A statement must be attached showing the
beneficiary’s share of income and directly apportioned
deductions from each business, rental real estate, and
other rental activity.

Cat. No. 11380D

Schedule K-1 (Form 1041) 2006

Schedule K-1 (Form 1041) 2006

Page

This list identifies the codes used on Schedule K-1 for
beneficiaries and provides summarized reporting information for
beneficiaries who file Form 1040. For detailed reporting and filing
information, see the Instructions for Beneficiary Filing Form 1040
and the instructions for your income tax return.
Report on
1. Interest income

Form 1040, line 8a

2a. Ordinary dividends

Form 1040, line 9a

2b. Qualified dividends

Form 1040, line 9b

3. Net short-term capital gain

Schedule D, line 5, column (f)

4a. Net long-term capital gain

Schedule D, line 12, column (f)

4b. 28% rate gain

Line 4 of the worksheet for
Schedule D, line 18

4c. Unrecaptured section 1250 gain

Line 11 of the worksheet for
Schedule D, line 19

12. Alternative minimum tax items
Code

6. Ordinary business Income

Schedule E, line 33, column (f)

Schedule E, line 33, column (d)
or (f)

7. Net rental real estate income

Schedule E, line 33, column (d)
or (f)

8. Other rental income

Schedule E, line 33, column (d)
or (f)

9. Directly apportioned deductions

Report on

A Adjustment for minimum tax purposes Form 6251, line 14
B AMT adjustment attributable to
qualified dividends
C AMT adjustment attributable to
net short-term capital gain
D AMT adjustment attributable to
net long-term capital gain
E AMT adjustment attributable to
unrecaptured section 1250 gain
F AMT adjustment attributable to
28% rate gain
G Accelerated depreciation
H Depletion
I Amortization
J Exclusion items
13. Credits and credit recapture

5. Other portfolio and nonbusiness
income

%

2

See the beneficiary’s
instructions and the
Instructions for Form 6251

2007 Form 8801

A Credit for estimated taxes

Form 1040, line 65

B Credit for backup withholding

Form 1040, line 64

C Low-income housing credit

Form 3800, line 1e

D Qualified rehabilitation expenditures

See the beneficiary’s instructions

E Basis of other investment credit
property

See the beneficiary’s instructions

F Work opportunity credit

Form 3800, line 1b

G Welfare-to-work credit

Form 3800, line 1c

H Alcohol fuel credit

Form 6478, line 5
(also see the beneficiary’s
instructions)

I Credit for increasing research
activities

Form 3800, line 1d

Code
A Depreciation

Form 8582 or Schedule E, line
33, column (c) or (e)

B Depletion

Form 8582 or Schedule E, line
33, column (c) or (e)

J Renewable electricity, refined coal,
and Indian coal production credit

See the beneficiary’s instructions

C Amortization

Form 8582 or Schedule E, line
33, column (c) or (e)

K Empowerment zone and renewal
community employment credit

Form 8844, line 3

L Indian employment credit

Form 3800, line 1i

M Orphan drug credit

Form 3800, line 1k

N Credit for employer provided child
care and facilities

Form 3800, line 1n

O Biodiesel and renewable diesel
fuels credit

Form 8864, line 9
(also see the beneficiary’s
instructions)

P Nonconventional source fuel credit

Form 3800, line 1s

Q Clean renewable energy bond
and Gulf tax credit bond credits
R Credits for employers affected
by Hurricane Katrina, Rita, or
Wilma
S Energy efficient appliance credit
T Recapture of credits

See the beneficiary’s instructions
and Form 8912
Form 3800, line 1aa
(also see the beneficiary’s
instructions)
Form 3800, line 1u
See the beneficiary’s instructions

10. Estate tax deduction

Schedule A, line 27

11. Final year deductions
A Excess deductions

Schedule A, line 22

B Short-term capital loss carryover

Schedule D, line 5, column (f)

C Long-term capital loss carryover

Schedule D, line 12, column (f);
line 5 of the wksht. for Sch. D,
line 18; and line 16 of the wksht.
for Sch. D, line 19

D Net operating loss carryover —
regular tax

Form 1040, line 21

E Net operating loss carryover —
minimum tax

Form 6251, line 27

14. Other information
A Tax-exempt interest

Form 1040, line 8b

B Foreign taxes

Form 1040, line 47 or
Sch. A, line 8

C Qualified production activities
income

Form 8903, line 7

D Form W-2 wages

Form 8903, line 13

E Net investment income

Form 4952, line 4a

F Gross farm and fishing income

Schedule E, line 42

G Foreign trading gross receipts
(IRC 942(a))

See the instructions for
Form 8873

H Other information

See the beneficiary’s instructions

Note. If you are a beneficiary who does not file a Form 1040,
see instructions for the type of income tax return you are filing.

Schedule K-1 (Form 1041) 2006

Page

3

Instructions for Beneficiary Filing Form 1040
Note: The fiduciary’s instructions for completing
Schedule K-1 are in the Instructions for Form 1041.

General Instructions
Purpose of Form
Use Schedule K-1 to report your share of the estate’s or
trust’s income, credits, deductions, etc. Keep it for your
records. Do not file it with your tax return. A copy has been
filed with the IRS.

Inconsistent Treatment of Items
Generally, you must report items shown on your Schedule K-1
(and any attached schedules) the same way that the estate or
trust treated the items on its return.
If the treatment on your original or amended return is
inconsistent with the estate’s or trust’s treatment, or if the
estate or trust was required to but has not filed a return, you
must file Form 8082, Notice of Inconsistent Treatment or
Administrative Adjustment Request (AAR), with your original or
amended return to identify and explain any inconsistency (or
to note that an estate or trust return has not been filed).
If you are required to file Form 8082 but fail to do so, you
may be subject to the accuracy-related penalty. This penalty is
in addition to any tax that results from making your amount or
treatment of the item consistent with that shown on the
estate’s or trust’s return. Any deficiency that results from
making the amounts consistent may be assessed
immediately.

Errors
If you believe the fiduciary has made an error on your
Schedule K-1, notify the fiduciary and ask for an amended or
a corrected Schedule K-1. Do not change any items on your
copy. Be sure that the fiduciary sends a copy of the amended
Schedule K-1 to the IRS. If you are unable to reach an
agreement with the fiduciary regarding the inconsistency, you
must file Form 8082.

Beneficiaries of Generation-Skipping Trusts
If you received Form 706-GS(D-1), Notification of Distribution
From a Generation-Skipping Trust, and paid a
generation-skipping transfer (GST) tax on Form 706-GS(D),
Generation-Skipping Transfer Tax Return for Distributions, you
can deduct the GST tax paid on income distributions on
Schedule A (Form 1040), line 8. To figure the deduction, see
the Instructions for Form 706-GS(D).

Specific Instructions
Part I—Information About the Estate or Trust
Item E
If the item E box is checked, this is the final year of the estate
or trust.
Note. If the “Final K-1” box at the top of Schedule K-1 is
checked, this is the final return for the beneficiary.

Item F
If the estate or trust is a registration-required tax shelter, it
should have completed item F. See the Instructions for Form
8271, Investor Reporting of Tax Shelter Registration Number,
to determine your reporting requirements.

Item G
If the estate or trust has invested in a registration-required tax
shelter, it must check item G and attach a copy of its Form
8271 to the Schedule K-1. If you claim or report any income,
loss, deduction, credit, or other tax benefit from a
registration-required tax shelter, you must also complete and
attach Form 8271 to your tax return. Use the information from
the attached Form 8271 to complete your form.

Part III—Beneficiary’s Share of Current Year
Income, Deductions, Credits, and Other
Items
The amounts shown in boxes 1 through 14 reflect your share
of income, loss, deductions, credits, etc., from an estate or
trust. For Form 1040 filers, page 2 of Schedule K-1 provides
summarized reporting information. The summarized reporting
information reflects references to forms in use for calendar
year 2006.
If you are not an individual, report the amounts in each box
as instructed on your tax return.
Codes. In box 9 and boxes 11 through 14, the fiduciary will
identify each item by entering a code in the column to the left
of the dollar amount entry space. These codes are identified
on the page 2 of Schedule K-1.
Attached statements. The fiduciary will enter an asterisk (*)
after the code, if any, in the column to the left of the dollar
amount entry space for each item for which it has attached a
statement providing additional information. For those
informational items that cannot be reported as a single dollar
amount, the estate or trust will enter an asterisk in the left
column and write “STMT” in the dollar amount entry space to
indicate the information is provided on an attached statement.

Boxes 3 and 4a—Net Short-Term and Net
Long-Term Capital Gain
If there is an attachment to this Schedule K-1 reporting a
disposition of a passive activity, see the Instructions for Form
8582, Passive Activity Loss Limitations, for information on the
treatment of dispositions of interests in a passive activity.

Box 5—Other Portfolio and Nonbusiness Income
The amount reported in this box is your distributive share of
royalties, annuities, and other income that is not subject to the
passive activity rules. It also includes income in respect of a
decedent (IRD), which is not included in boxes 1, 2a, 3, 4a, 6,
7, or 8.

Boxes 6 through 8—Ordinary Business Income, Net
Rental Real Estate Income, and Other Rental Income
The deductions in boxes 6 through 8 may be subject to the
passive loss limitations of Internal Revenue Code section 469,
which generally limits deductions from passive activities to the
income from those activities. The fiduciary will provide you
with a separate schedule showing your distributive share of
income from each trade or business, net rental real estate, or
other rental activity. The rules for applying these limitations to
beneficiaries have not yet been issued. For more details, see
Pub. 925, Passive Activity and At-Risk Rules.

Schedule K-1 (Form 1041) 2006

Box 9—Directly Apportioned Deduction
The fiduciary must attach a statement showing depreciation,
depletion, and amortization directly apportioned to you, if any,
for each activity reported in boxes 5 through 8.

Box 12—Alternative Minimum Tax Items
The information reported in box 12, codes A through I is used
to prepare your Form 6251, Alternative Minimum
Tax—Individuals. Code A, Adjustment for minimum tax
purposes, is the total amount reported on Form 6251, line 14.
Codes B through F represent the portion, if any, of the amount
included in code A.
Codes B through F. If you have an amount in box 12 with
code B, C, D, E, or F, see the instructions for lines 37, 38, and
39 of Form 6251.
Codes G through I. Include the amount with any of these
codes on the applicable line of Form 6251.
Code J. Exclusion items. If you pay alternative minimum tax
in 2006, the amount in box 12, code J will help you figure any
minimum tax credit for 2007. See the 2007 Form 8801, Credit
for Prior Year Minimum Tax—Individuals, Estates, and Trusts,
for more information.

Box 13—Credits and Credit Recapture
Codes A through R list all the credits that may be allocated to
you as a beneficiary. The corresponding line shows you what
form to use when reporting the amount.
Code A. Credit for estimated taxes. The beneficiary treats
this amount as a payment of estimated tax. To figure any
underpayment and penalty on Form 2210, Underpayment of
Estimated Tax by Individuals, Estates, and Trusts, treat the
amount entered on box 13, code A, as an estimated tax
payment made on January 15, 2007.
Note. Form 1041-T, Allocation of Estimated Tax Payments to
Beneficiaries, must be timely filed by the fiduciary for the
beneficiary to get the credit for an estimated tax payment.
Code D. Qualified rehabilitation expenditures.The fiduciary
must provide you with a statement that shows the amount of
any qualified rehabilitation expenditures and which line on
Form 3468, Investment Credit, to report those expenditures.
Code E. Basis of other investment credit property. This
code is used to report the basis of property for figuring the
energy credit, the qualifying advanced coal project credit, and
the qualifying gasification project credit on lines 2 through 4 of
Form 3468. The fiduciary must provide you with a statement
that shows the amount of basis and where to report it on Form
3468. If your statement includes an amount to be reported on
line 2c or 2f, the statement must also show an additional
amount to report on line 2d or 2g.

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4

Code H. Alcohol fuel credit. If this credit includes the small
ethanol producer credit, the fiduciary will provide additional
information on an attached statement. If a statement is
attached, see the instructions for line 5 of Form 6478, Credit
for Alcohol Used as Fuel.
If no statement is attached, report this amount on Form
6478, line 5.
Code J. Renewable electricity, refined coal, and Indian
coal production credit. Complete Form 8835, Renewable
Electricity, Refined Coal, and Indian Coal Production Credit, to
figure the amount of your credit. The fiduciary must provide a
statement showing the amount of credit to report on line 9 in
Section A, and how much to report on line 23 in Section B of
Form 8835.
Code O. Biodiesel and renewable diesel fuels credit. If this
credit includes the small agri-biodiesel producer credit, the
fiduciary will provide additional information on an attached
statement. If no statement is attached, report this amount on
line 9 of Form 8864, Biodiesel and Renewable Diesel Fuels
Credit. If a statement is attached, see the instructions for Form
8864, line 9.
Code Q. Clean renewable energy bond and Gulf tax credit
bond credits. Complete Form 8912, Credit for Clean
Renewable Energy and Gulf Tax Credit Bonds, to figure the
amount of your allowable credit. The fiduciary must provide
you a statement showing the amount to report on line 3 and
line 9 of Form 8912.
Code R. Credits for employers affected by Hurricane
Katrina, Rita, or Wilma. The fiduciary must provide you with a
statement that shows the amount of the credit to report on
line 3 and line 7 of Form 5884-A, Credit for Employers
Affected by Hurricane Katrina, Rita, or Wilma, if you are
required to file this form in addition to Form 3800.
Code T. Recapture of credits. If you are required to
recapture any credits, the fiduciary will provide a statement
with the information you need to figure your credit recapture.

Box 14—Other Information
Code F. Gross farming and fishing income. The amount of
farming and fishing income is included in box 6. This income
is separately stated to help you determine if you are subject to
a penalty for underpayment of estimated tax. Report the
amount of gross farming and fishing income on Schedule E
(Form 1040), line 42.
Code H. Other income. If this code is used, the fiduciary will
provide you with any additional information you may need to
file your return that is not shown elsewhere on this Schedule
K-1.