Nebraska Electing Small Business Trust Tax Calculation Worksheet

Electing Small Business Trust Tax Calculation Worksheet
Form 1041N -Wkst
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Electing Small Business Trust (ESBT)
Tax Calculation Worksheet
	 Name on Form 1041N	

Nebraska ID Number

FORM 1041N
ESBT Worksheet

2023

		
	1	Total federal income .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 	 1

00

	 2	 Federal taxable income  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 	 2

00

Adjustments
	3	Income from U.S. government bonds or other U.S. obligations  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 	3
	4	Income from non-Nebraska state and local bond interest and other Nebraska adjustments increasing federal
		 taxable income (includes Nebraska and local income, sales and use taxes deducted under section 164 of the
		 IRC) (see instructions). List the types and enter the total amount on line 4
		
		4
	5	Nebraska adjustments decreasing federal taxable income. List the types and enter the total amount on line 5
			
	5

00

	6	Nebraska taxable income (line 2 plus line 4) minus (lines 3 and 5) .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 	6

00

	

	

00
00

•	 Nonresident ESBTs should not make entries on lines 7, 8, or 9 of this worksheet. Nonresident ESBTs must complete the Computation
of Nebraska Tax for Nonresident ESBT section (below) to determine their Nebraska tax.

	7	Nebraska income tax (use the tax rate schedule on page 8 of the Form 1041N instructions to calculate
		 the amount of tax)  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 	7

00

	8	Nebraska other tax .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 	8

00

	9	Total Nebraska tax (line 7 plus line 8). Enter here and on line 10, Form 1041N .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 	9
Computation of Nebraska Tax For Nonresident ESBT

00

	10	 Nebraska taxable income (from line 6 above)  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 	10
	11	 Nebraska income tax (use the tax rate schedule on page 8 of the Form 1041N instructions to calculate
		 the amount of tax)  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 	11

00

	12	 Nebraska other tax .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 	12

00

	13	 Total Nebraska tax (line 11 plus line 12) .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 	13

00

	14	 Income derived from Nebraska sources, except capital and ordinary gain (loss) .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 	14

00

	15	 Nebraska capital and ordinary gain (loss)  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 	15
	16	 Adjustments as applied to Nebraska income, if any (includes Nebraska and local income, sales and use taxes
		 deducted under section 164 of the IRC).
		List:____________________________________________________________________________________ 	 16
	
	17	 Nebraska adjusted gross income (line 14 plus or minus lines 15 and 16)  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  . 	17
	18	 Nebraska share of line 13. Compute below, and enter result here and on line 42, Schedule I, Form 1041N.
		 Calculate the ratio to five decimal places and round to four.

00

		

Line 17

		

(Line 1 + Line 4) – (Line 3 + Line 5)	

=

.

x
(Ratio)	

00

00
00

=
(Line 13)		18

00

8-599-2023

Instructions
Who Must File. This worksheet must be filed by an Electing Small Business Trust (ESBT) which receives income from an
S corporation doing business in Nebraska and which is taxed under Internal Revenue Code (IRC) § 641(c).
When and Where to File. This worksheet must be completed and attached to the Nebraska Fiduciary Income Tax Return,
Form 1041N. 				
Specific Instructions. Under IRC § 641(c), an ESBT receiving income from an S corporation is required to calculate its
tax liability as a separate trust. Nebraska also requires an ESBT to calculate its Nebraska tax on the S corporation income
as a separate trust. All amounts entered on this Worksheet must be related to the amounts received from the S corporation
and used to calculate the separate federal tax. If the separate federal tax was based on distributions received from more than
one S corporation, this worksheet should include the aggregate amounts received.
Reminder: ESBTs receiving income or losses from S corporations doing business in more than one state must adjust their
federal taxable income as indicated in the instructions for line 4 and line 5 of this worksheet.
Line 1. Enter the ESBT’s total federal income received from the S corporation.
Line 2. Enter the ESBT’s federal taxable income. This amount should be included in the supplemental information of the
ESBT’s federal income tax return. 		
Line 3. Enter the amount of interest and dividend income from U.S. government obligations exempt from state taxation. The
Taxability of Interest and Dividend Income From State, Local, and U.S. Government Obligations Information Guide, lists
U.S. interest and dividend income which can be included on line 3. Interest income from repurchase agreements involving
U.S. government obligations is not deductible as U.S. government interest.
Gains or losses from the sale or other disposition of federal securities are taxable for state income tax purposes and should
not be included on line 3.
Line 4. Enter the total adjustments increasing federal taxable income. This income includes, but is not limited to:
	

•	

Non-Nebraska state or local obligations exempt from federal taxation;

	

•	

Any loss from an S corporation or limited liability company (LLC) which was not from Nebraska sources; and

	

•	

Federal net operating or capital losses deducted in computing federal taxable income.

	

•	

Nebraska and local income, sales and use taxes deducted under section 164 of the IRC (from Schedules K-1N)

Line 5. The net income received from an S corporation that is not related to Nebraska sources is deducted from federal
taxable income. This deduction is limited to the amount included in federal taxable income. An estate or trust cannot include
in this deduction any amount of S corporation or LLC income from non-Nebraska sources that was part of the qualified
business income deduction claimed on its federal return. For information on other deductions, see Nebraska Fiduciary
Income Tax Regulation 23-004, Taxation of Resident and Nonresident Estates and Trusts.
Line 7. A resident ESBT will compute and report its tax liability on lines 7 and 8 of the Worksheet and enter the total on
line 9 of the Worksheet. This total will also be carried to line 10 of Form 1041N.
A nonresident ESBT will not use lines 7, 8, and 9 of the Worksheet. A nonresident ESBT must complete lines 10 through 18
of the Worksheet to determine its Nebraska tax liability.
Line 8. Use the Nebraska Other Tax Worksheet to calculate the amount to enter on line 8. The worksheet may be found in
the instructions for line 9 of the Form 1041N.
Line 12. Use the Nebraska Other Tax Worksheet to calculate the amount to enter on line 12. The worksheet may be found
in the instructions for line 9 of the Form 1041N.
Line 14. Enter the entire net income or loss distributed from the S corporation to the ESBT.
If the S corporation has business activity in more than one state, only a portion of the income is included on line 14. The
portion included will be based on the S corporation’s Nebraska apportionment factor.
Line 15. Enter the taxable amount of Nebraska capital and ordinary gain and loss distributed from the S corporation.
Line 16. The adjustments must relate to Nebraska income amounts reported on lines 14 and 15. Include a schedule
specifically identifying the adjustments claimed. Add an increasing adjustment for the Nebraska and local income, sales and
use taxes deducted under section 164 of the IRC Form (Schedules K-1N).
Line 18. The ratio used in the division calculation of this line must be computed to five decimal places and rounded to four.
Enter the amount from line 18 on line 42, Schedule I, Form 1041N.