• Courtney

Top 5 Mistakes We See in Estate and Trust Returns

At BBTA, we work on estate and trust returns for individuals and law firms across the country. These are the most common mistakes we correct, and avoiding them will save the trustee and trust valuable time and money.

1. Taxing income at the trust level

Trusts can choose to pass income and tax liability on to their beneficiary through distributions. This can mean the difference between paying tax at a 10% or 37% rate.

2. Not opting for QDT status

Many trusts can be classified as a Qualified Disability Trust, which enables them to not pay tax on the first $4,000 in income instead of the standard $100.

3. Poor timing of income and deductions

Trusts can reduce or eliminate tax liabilities by choosing to roll expense deductions paid in the first 65 days of one year back to the prior year’s tax filing.

4. Not having proper asset basis

Trusts that are funded from inheritance may be subject to a higher tax if the step-up basis for stocks isn’t properly calculated and if real estate appraisals aren’t performed.

5. Failing to meet payroll obligations

Not complying with federal and state payroll tax requirements for caregivers is the most costly error that a trustee can make, both for the trust and the trustee. Failure to file the various returns with all four agencies can result in fines, interest and levies.

32 views0 comments

Recent Posts

See All

Federal Help with COVID-19 Funeral Expenses

If anyone you know had been through death due to COVID-19, the Federal Government may help you with unexpected funeral costs. You may qualify if: You are a U.S. citizen, non-citizen national, or a qua

Changes To Your 2021 Child Tax Credit

The American Rescue Plan Act, passed in 2021, increased child tax credits for the 2021 return to $3,600 if under age 6 and $3,000 if age 6 to 17. These credits begin to go away once your adjusted gro

Covid-19 Help for Small Businesses

Hello everyone, Between the State and Federal government stimulus programs we now have a few options to keep your business going.  Below I've attached some links - some of these expire soon, so take a

BBTA Tax Advisors


(586) 276-0720 | (888) 808-7748

3603 E 14 Mile Rd, Sterling Heights, MI  48310, USA



(734) 773-0713

229 Depot St, Ann Arbor, MI  48103, USA

Fax: (586) 276-0723



Only Enrolled Agents are required to demonstrate to the IRS their competence in all areas of taxation, representation and ethics before they are awarded unlimited right to represent taxpayers before the IRS.  Unlike CPAs which are licensed by the state and might not specialize in tax law, BBTA’s Enrolled Agents are federally licensed to represent our clients to the IRS in all fifty states.



3606 E 14 Mile Rd

Sterling Heights, MI 48310

(586) 276-0720

Screen Shot 2021-10-03 at 2.11_edited.jpg


229 Depot St

Ann Arbor, MI 48104

(734) 773 0713