4970 Tax on Accumulation Distribution of Trusts OMB No. 1545-0192 Form 2019 a Attach to beneficiary’s tax return. Department of the Treasury Attachment Internal Revenue Service a Go to www.irs.gov/Form4970 for the latest information. Sequence No. 178 A Name(s) as shown on return B Social security number

C Name and address of trust D Employer identification number

E Type of trust (see instructions) F Beneficiary’s date of birth G Enter the number of trusts from which you received Domestic Foreign accumulation distributions in this tax year ....a Part I Average Income and Determination of Computation Years 1 Amount of current distribution that is considered distributed in earlier tax years (from Schedule J (Form 1041), line 37, column (a)) ...... 1 2 Distributions of income accumulated before you were born or reached age 21 ...... 2 3 Subtract from ...... 3 4 Taxes imposed on the trust on amounts from (from Schedule J (Form 1041), line 37, column (b)) . 4 5 Total (add lines 3 and 4) ...... 5 6 Tax-exempt interest included on (from Schedule J (Form 1041), line 37, column (c)) .... 6 7 Taxable part of line 5 (subtract from line 5) ...... 7 8 Number of trust’s earlier tax years in which amounts on line 7 are considered distributed .... 8 9 Average annual amount considered distributed (divide line 3 by ) . . . 9 10 Multiply by 25% (0.25) ...... 10 11 Number of earlier tax years to be taken into account (see instructions) ...... 11 12 Average amount for recomputing tax (divide line 7 by line 11). Enter here and in each column on line 15 12 13 Enter your taxable income before (a) 2018 (b) 2017 (c) 2016 (d) 2015 (e) 2014 this distribution for the 5 immediately preceding tax years. Part II Tax Attributable to the Accumulation Distribution (a) (b) (c) 14 Enter the amounts from line 13, eliminating the highest and lowest taxable income years ...... 14

15 Enter amount from line 12 in each column ...... 15

16 Recomputed taxable income (add lines 14 and 15) ...... 16

17 Income tax on amounts on line 16 ...... 17

18 Income tax before credits on line 14 income ...... 18

19 Additional tax before credits (subtract line 18 from line 17) . . . 19

20 Tax credit adjustment ...... 20

21 Subtract from line 19 ...... 21

22 Alternative minimum tax adjustments ...... 22

23 Combine lines 21 and 22 ...... 23 24 Add columns (a), (b), and (c), line 23 ...... 24 25 Divide the line 24 amount by 3.0 ...... 25 26 Multiply the amount on line 25 by the number of years on line 11 ...... 26 27 Enter the amount from ...... 27 28 Partial tax attributable to the accumulation distribution (subtract line 27 from line 26) (If zero or less, enter -0-) ...... 28 For Paperwork Reduction Act Notice, see the instructions. Cat. No. 13180V Form 4970 (2019) Form 4970 (2019) Page 2

General Instructions to U.S. sources or is effectively connected with a To refigure these credits, you must consider trade or business carried on in the United States. changes to the tax before credits for each of the Section references are to the Internal Revenue Line 2. Enter any amount from line 1 that 3 computation years due to previous Code unless otherwise noted. represents UNI of a domestic trust accumulated accumulation distributions. Future Developments before you were born or reached age 21. If the accumulation distribution is from a However, if the multiple trust rule applies, see the domestic trust that paid foreign income taxes, For the latest information about developments instructions for line 4. the limitation on the foreign tax credit under related to Form 4970 and its instructions, such section 904 is applied separately to the as legislation enacted after they were published, Line 4. Multiple trust rule. If you received accumulation distribution. If the distribution is go to www.irs.gov/Form4970. accumulation distributions from two or more other trusts that were considered to have been from a foreign trust, see sections 667(d) and Purpose of Form made in any of the earlier tax years in which the 904(f)(4) for special rules. A beneficiary of certain domestic trusts (see current accumulation distribution is considered Attach the proper form for any credit you Who Must File below) uses Form 4970 to figure to have been made, don’t include on line 4 the refigure. The amount determined for items on the partial tax on accumulation distributions taxes attributable to the current accumulation this line is limited to tax law provisions in effect under section 667. The fiduciary notifies the distribution considered to have been distributed for those years involved. beneficiary of an “accumulation distribution” by in the same earlier tax year(s). Line 22. For each year entered in Part II, columns completing Part IV of Schedule J (Form 1041). For this special rule, only count as trusts those (a)–(c), use and attach that year’s Form 4626, If you received a distribution for this tax year trusts for which the sum of this accumulation Alternative Minimum Tax—Corporations (for from a trust that accumulated its income instead distribution and any earlier accumulation years prior to 2018); Form 6251, Alternative of distributing it each year (and the trust paid distributions from the trust, which are considered Minimum Tax—Individuals; or Schedule I (Form taxes on that income), you must complete Form under section 666(a) to have been distributed in 1041), Alternative Minimum Tax—Estates and 4970 to compute any additional tax liability. The the same earlier tax year(s), is $1,000 or more. Trusts, to recompute the AMT for that year. trustee must give you a completed Part IV of Foreign trust. If the trust is a foreign trust, see Show any change in the AMT below the bottom Schedule J (Form 1041) so you can complete section 665(d)(2). margin of the appropriate form or schedule and this form. Line 8. You can determine the number of years enter the change on line 22. If you received accumulation distributions from in which the UNI is deemed to have been Line 28. If estate taxes or generation-skipping more than one trust during the current tax year, distributed by counting the “throwback years” transfer taxes apply to the accumulation prepare a separate Form 4970 for each trust for which there are entries on lines 32 through 36 distribution, reduce the partial tax proportionately from which you received an accumulation of Part IV of Schedule J (Form 1041). These for those taxes. See section 667(b)(6) for the distribution. You can arrange the distributions in throwback rules apply even if you wouldn’t have computation. any order you want them considered to have been entitled to receive a distribution in the Individuals. Include the amount from this line on been made. earlier tax year if the distribution had actually Schedule 2 (Form 1040 or 1040-SR), line 8c. been made then. There can be more than 5 Write “ADT” on the line 8c entry space. Who Must File “throwback years.” Trusts and decedents’ estates. Include the Beneficiaries who received an accumulation Line 11. From the number of years entered on amount on Form 1041, Schedule G, line 8. Write distribution from certain domestic trusts that line 8, subtract any year in which the distribution “From Form 4970” and the amount of the tax to were created before March 1, 1984, must file from column (a), Part IV of Schedule J (Form the left of the line 8 entry space. Form 4970. For details, see section 665(c). 1041) is less than the amount on of Form Other filers. Add the result to the total tax Foreign trust beneficiaries. If you received an 4970. If the distribution for each throwback year liability before the refundable credits on your accumulation distribution from a foreign trust, is more than line 10, then enter the same number income tax return for the year of the you must report the distribution and the partial on line 11 as you entered on line 8. accumulation distribution. Attach this form to tax on a 2019 Form 3520, Annual Return To Line 13. Enter your taxable incomes for years that return. Report Transactions With Foreign Trusts and 2014–2018, even if less than 5 years of the trust Receipt of Certain Foreign Gifts. had accumulated income after you became 21. Paperwork Reduction Act Notice. We ask for Don’t file Form 4970 for distributions from any Use the taxable income as reported by you or as the information on this form to carry out the foreign trusts, except to attach it as a worksheet changed by the IRS. Include in the taxable Internal Revenue laws of the United States. You to Form 3520 if those instructions direct you to. income amounts considered distributed in that are required to give us the information. We need Note: If the accumulation distributions are from a year as a result of prior accumulation it to ensure that you are complying with these domestic trust that used to be a foreign trust, see distributions, whether from the same or another laws and to allow us to figure and collect the Rev. Rul. 91-6, 1991-1 C.B. 89. trust, and whether made in an earlier year or the right amount of tax. current year. You aren’t required to provide the information Definitions If your taxable income as adjusted is less than requested on a form that is subject to the Undistributed net income (UNI). UNI is the zero, enter zero. Paperwork Reduction Act unless the form distributable net income (DNI) of the trust for any Line 17. Figure the income tax (excluding any displays a valid OMB control number. Books or tax year less (1) the amount of income required alternative minimum tax (AMT)) on the income on records relating to a form or its instructions must to be distributed currently and any other line 16 using the tax rates in effect for your be retained as long as their contents may amounts properly paid or credited or required to particular earlier tax year shown in each of the become material in the administration of any be distributed to beneficiaries in the tax year and three columns. Use the Tax Rate Schedules, etc., Internal Revenue law. Generally, tax returns and (2) the taxes imposed on the trust attributable to as applicable. You can get the Tax Rate return information are confidential, as required by such DNI. Schedules and prior year forms from many IRS section 6103. Accumulation distribution. An accumulation offices by calling 1-800-TAX-FORM The time needed to complete and file this form distribution is the excess of amounts properly (1-800-829-3676), or by downloading them at will vary depending on individual circumstances. paid, credited, or required to be distributed www.irs.gov. The estimated burden for individual taxpayers (other than income required to be distributed Line 18. Enter your income tax (excluding any filing this form is approved under OMB control currently) over the DNI of the trust reduced by AMT) as originally reported, corrected, or number 1545-0074 and is included in the income required to be distributed currently. amended, before reduction for any credits for estimates shown in the instructions for their Generally, except for tax-exempt interest, the your particular earlier year shown in each of the individual income tax return. The estimated distribution loses its character upon distribution three columns. burden for all other taxpayers who file this form is to the beneficiary. See section 667(d) for special Line 20. Nonrefundable credits that are limited to shown below. rules for foreign trusts. tax liability, such as the general business credit, Learning about the may be changed because of an accumulation law or the form ...... 13 min. Specific Instructions distribution. If the total allowable credits for any Preparing the form ...... 52 min. Item E—Type of trust. If you received an of the 3 computation years increase, enter the Copying, assembling, accumulation distribution from a foreign trust, increase on line 20. However, don’t treat as an and sending the form to the IRS .. 20 min. see Foreign trust beneficiaries, earlier. Don’t file increase the part of the credit that was allowable If you have comments concerning the this form other than as an attachment to Form as a carryback or carryforward credit in the accuracy of these time estimates or suggestions 3520. current or any preceding year other than the for making this form simpler, we would be happy computation year. Line 1. For a nonresident alien or foreign to hear from you. See the instructions for the tax corporation, include only the part of the return with which this form is filed. accumulation distribution that is attributable