N-40 Sch. J: Trust Allocation of an Accumulation Distribution (Form N-40) (2025)
Hawaii · Hawaii DoTax · Used for tax years 2025
Hawaii Schedule J (Form N-40) reports a trust’s accumulation distribution for 2025 and allocates it to earlier tax years. It also calculates taxes on undistributed net income and each beneficiary’s share of the allocated amounts. File this schedule with Form N-40.
Who files this form
The 2025 Schedule J is for domestic complex trusts that distributed income accumulated in earlier years. It allocates an accumulation distribution to the applicable earlier years and to beneficiaries.
File Schedule J with Form N-40.
What you'll need
Have the following information and forms available:
- The trust’s name, federal employer identification number, and tax year beginning and ending dates.
- The 2025 Form N-40, Schedule B, including lines 9, 11, and 12 for Part I.
- Form N-40 and Schedules B, D, and G for the applicable throwback years. Parts II and III use income, distribution, capital gain, and tax amounts from these forms.
- Accounting income under the governing instrument and amounts of prior accumulation distributions allocated to the throwback years.
- Each beneficiary’s name, identifying number, mailing address, and share of the amounts being allocated.
- Form N-405, Tax on Accumulation Distributions of Trusts.
The form also directs you to the federal Instructions for Form 1041, Schedule J, and the Form N-40 Instructions.
How to file
File Schedule J with Form N-40.
- Complete Part I to calculate the accumulation distribution for 2025.
- Enter the applicable throwback years in Parts II and III. Allocate the amount on line 5 to the earliest applicable year first, without exceeding line 12 for that year.
- Complete Part IV for each beneficiary. Attach an additional Schedule J with Part IV completed for each additional beneficiary.
- Attach additional schedules if more than five throwback years are involved.
- Complete Form N-405 and enter the Part IV line 31 totals on its appropriate lines.
The supplied form does not give a mailing address or e-filing directions.
Common mistakes
- Omitting extra schedules: Attach additional schedules when the distribution is thrown back to more than five years, starting with the earliest applicable tax year beginning after 1968.
- Leaving out a beneficiary’s allocation: Complete Part IV for each beneficiary and attach an additional Schedule J for each additional beneficiary.
- Forgetting Form N-405: The form specifically reminds you to complete it.
- Skipping the special reference for distributions from another trust: If the trust received an accumulation distribution from another trust, the form directs you to federal Regulations section 1.665(d)-1A.
Questions people ask
How is the accumulation distribution for 2025 calculated?
Part I starts with other amounts paid, credited, or required to be distributed on line 1. Line 4 is distributable net income on line 2 minus income required to be distributed currently on line 3. If line 3 exceeds line 2, enter zero on line 4. Subtract line 4 from line 1 to get the accumulation distribution on line 5.
Which throwback year receives the allocation first?
Line 13 directs you to allocate the amount on line 5 to the earliest applicable year first, but not more than line 12 for that year.
What if there are more than five throwback years?
Attach additional schedules.
What if the distribution is allocated to multiple beneficiaries?
Complete Part IV for each beneficiary. Attach an additional Schedule J with Part IV completed for each additional beneficiary.
Where do the beneficiary allocation totals go?
Add lines 26 through 30 and enter the totals on line 31 and on the appropriate lines of Form N-405.