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Page 6 of 8 Fileid: … s/i3520a/202312/a/xml/cycle04/source 10:44 - 10-Oct-2023
The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.
Income fiduciary must make an interest allocation according to the
rules in Temporary Regulations section 1.163-8T.
Line 1. Interest. Report all taxable interest income that
was received during the tax year. Examples of taxable Do not include interest paid on indebtedness incurred
interest include, but are not limited to, interest from the or continued to purchase or carry obligations on which the
following. interest is wholly exempt from income tax.
• Accounts (including certificates of deposit and money Line 10a. Foreign taxes. A foreign tax includes only a
market accounts) with banks, credit unions, and thrift tax imposed by the authority of a foreign country.
institutions.
Line 10b. State and local taxes. Enter any deductible
• Notes, loans, and mortgages.
state and local income or real property taxes paid or
• U.S. Treasury bills, notes, and bonds.
incurred during the tax year that are not reported
• U.S. savings bonds.
elsewhere in Part II.
• Original issue discount.
• Income received as a regular interest holder of a real Do not deduct on line 10b or on any other line of Part II:
estate mortgage investment conduit (REMIC). • Federal income taxes;
For taxable bonds acquired after 1987, amortizable • Estate, inheritance, legacy, succession, and gift taxes;
or
bond premium is treated as an offset to the interest
income instead of as a separate interest deduction. See • Federal duties and excise taxes.
Pub. 550, Investment Income and Expenses. Line 11. Amortization and depreciation (depletion). A
reasonable amount is allowed as a depreciation deduction
Line 2. Dividends. Report all ordinary dividends
for the exhaustion, wear, and tear of:
received during the tax year.
• Property used in a trade or business, or
Note. Report capital gain distributions on Line 5. Capital • Property held for the production of income.
gains (losses) of this section. Line 12. Trustee and advisor fees. Enter the deductible
Line 4. Income (loss) from partnerships, fiduciaries, fees paid or incurred to the fiduciary for administering the
etc. Enter the trust's share of income or (losses) from trust during the tax year.
partnerships, S corporations, estates, other trusts, and Line 13. Charitable contributions. Generally, any part
REMICs. of the income reported on line 8 that is paid (or treated as
If the trust received a Schedule K-1 from a partnership, paid) during the tax year for a charitable purpose specified
S corporation, or other flow-through entity, use the in section 170(c) is allowed as a deduction. It is not
corresponding lines on Form 3520-A to report the interest, necessary that the charitable organization be created or
dividends, capital gains, etc., from the flow-through entity. organized in the United States.
Line 5. Capital gains (losses). For capital gains or Line 14. Other expenses. Enter other items of expense
(losses) attributable to a U.S. owner, use Schedule D not listed on lines 9 through 13. List the type and amount
(corporate or individual, whichever applies) and Form on an attached statement if the trust has more than one
8949, Sales and Other Dispositions of Capital Assets, if item.
applicable. Line 17a. FMV of total distributions. Attach a
Line 6. Ordinary gains (losses). Enter the ordinary gain statement that provides the following information
or (loss) from the sale or exchange of property other than concerning the transfer.
capital assets and also from involuntary conversions 1. Name, U.S. TIN (if any), and country of organization
(other than casualty or theft). or residence of the person to whom the property was
Line 7. Other income. Enter other items of income not transferred.
included on lines 1 through 6. List the types and amounts 2. A general description of the transfer, and any
on an attached statement if the trust has more than one broader transaction of which it forms a part, including a
item. chronology of the transfers involved and an identification
Items to be reported on line 7 include any part of a total of the other parties to the transaction to the extent known.
distribution shown on Form 1099-R, Distributions From 3. A description of the property transferred, including
Pensions, Annuities, Retirement or Profit-Sharing Plans, the estimated FMV and the adjusted basis of the property.
IRAs, Insurance Contracts, etc., that is treated as ordinary 4. A description of the consideration received by the
income. For more information, see the instructions for trust, including its estimated FMV, and for stock or
Form 4972, Tax on Lump-Sum Distributions. securities, the class or type, amount, and characteristics
of the interest received. If no consideration was received
Expenses
by the trust, indicate whether the trust or a U.S. owner
Line 9. Interest expense. Enter the amount of interest exercises any powers over the entity to which the property
(subject to limitations) paid or incurred by the trust on was transferred (including a description of such powers),
amounts borrowed by the trust, or on debt acquired by the and identify the name, U.S. TIN (if any), and country of
trust, that is not reported elsewhere in Part II. organization or residence of all beneficial owners of such
If the proceeds of a loan were used for more than one entity.
purpose (for example, to purchase a portfolio investment 5. To the extent known, a description of any
and to acquire an interest in a passive activity), the subsequent transfer of the property, including the name,
-6- Instructions for Form 3520-A (Rev. 12-2023)
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