Estates and trusts

Overview

An estate is all the property a person owns (money, car, house, etc.). When a person passes away, their estate may be taxed. Estates generally have the following basic elements:

  • Decedent
  • Administrator of the estate (executor)
  • Person who may receive property or income from the estate (beneficiary)
  • Property

A trust is an agreement to hold and administer property, typically in a written document in which someone (a trustee) is responsible for managing property for someone else (beneficiary). Property can include:

  • Money
  • Car
  • House
  • Other

Trusts must have the following basic elements:

  • Creator of the trust (trustor/grantor)
  • Manager of the trust (trustee or fiduciary)
  • Person who will receive property from the trust (beneficiary)
  • Property

Filing requirements

Estates

The executor may have to file a return if the estate meets any of these:

  • The decedent was a California resident at the time of death
  • Gross income is over $10,000
  • Net income is over $1,000
  • The estate has income from a California source
  • Income is distributed to a beneficiary

Trusts

The trustee may have to file a return if the trust meets any of these:

  • The trustee or beneficiary (non-contingent) is a California resident
  • The trust has income from a California source
  • Income is distributed to a California resident beneficiary

And the trust has:

  • Gross income is over $10,000
  • Net income is over $100

What form to file

File Form 541 in order to:

  • Report income received by an estate or trust
  • Report income distributed to beneficiaries
  • File an amended return for the estate or trust
  • Claim withholding

Tax forms

Visit Forms to get older forms.

Due dates and mailing addresses

Estates

When filing an estate return, the executor follows the due dates for estates.

Trusts

When filing a trust return, the trustee follows the due dates for individuals.

Estimate payments

Your estate or trust may be required to make estimate payments. Visit Estimated Tax for Fiduciaries instructions (Form 541-ES) for more information.

Prompt audit request

Under California Revenue and Taxation Code (R&TC) Section 19517, fiduciaries may request an 18-month statute of limitations instead of the normal four years after filing:

  • A decedent’s individual tax return.
  • An estate tax return.
  • A trust tax return.

The request must be in writing by submitting IRS Form 4810, Request for Prompt Assessment Under Internal Revenue Code Section 6501(d), or with a letter. The requester must clearly indicate that a request for a prompt assessment under R&TC Section 19517 is being made and give the tax years involved.

To submit this request, gather:

  • A copy of the completed tax return.
  • A letter requesting a prompt assessment.

Mail these items to:
Attn: Estates and Trusts Audit Unit; MS: F-320
Franchise Tax Board
PO Box 1673
Sacramento CA 95812-1673

You may find it helpful to review your tax account (balance, debts).

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