Form 1041 changes for estates and trusts, tax year 2025

The IRS revised the state and local tax deduction worksheet to fix an issue that could affect filers with adjusted gross income over $500,000. Lines 4, 6 and 7 changed and a new line 8 holds the final deduction. A fiduciary that filed with the old worksheet and gets a higher deduction on recalculation should file an amended 2025 Form 1041.

• Direct deposit fields on lines 30c to 30e for an overpayment on line 29; balance due on line 28.
• Section 1062 farmland installments: full liability on Schedule G, Part II, line 18c, and the first installment on page 1, line 25b.
• Section 174A domestic research costs: deduct or amortize over at least 60 months.
• Capital gains: 0% up to $3,250, 15% above that up to $15,900, and 20% above $15,900.
• A bankruptcy estate must file only if gross income is at least $15,750; a qualified disability trust exemption can be up to $5,100.

Pull every 2025 Form 1041 already filed with AGI over $500,000 and a state tax deduction, and recalculate with the revised worksheet. Keep the recalculation in the file even when it does not change the result.