N-40 Sch. K1: Beneficiary’s Share of Income, Deductions, Credits, etc. (2024)
Hawaii · Hawaii DoTax · Used for tax years 2024
Hawaii Schedule K-1 (Form N-40) reports a beneficiary’s share of income, deductions, credits, and other items from a trust or decedent’s estate. It also provides instructions for reporting these amounts on Forms N-11 and N-15.
Who files this form
A separate Schedule K-1 (Form N-40) must be completed for each beneficiary of a trust or decedent’s estate. It reports the beneficiary’s share of income, deductions, credits, and other items.
The beneficiary instructions explain how to report these items on Hawaii Form N-11 or Form N-15.
When it's due
For tax year 2024, treat the estimated tax credit on line 9a as an estimated tax payment made on January 20, 2025, when computing any underpayment and penalty on Form N-210.
This is a payment treatment date, not a filing deadline. The supplied text does not state a filing deadline for Schedule K-1.
What you'll need
Have the following information and documents available, as applicable:
- The beneficiary’s name, mailing address, and identifying number.
- The estate’s or trust’s name and EIN, and the fiduciary’s name and mailing address.
- Amounts for the beneficiary’s share of income, deductions, credits, and other items listed on the schedule.
- A separate sheet listing net income taxes paid to another state or foreign country for line 6.
- Your federal Schedule K-1 (Form 1041), if you file Form N-11 and need to compare federal and Hawaii amounts.
- Form N-312, N-586, or N-346 to calculate the credits on lines 7a, 7b, or 7c, respectively.
- A copy of Schedule K-1 to attach to your Hawaii income tax return if you claim the estimated tax credit on line 9a.
How to file
Use the schedule’s line references and beneficiary instructions to report the amounts on Form N-11 or Form N-15 and the applicable worksheets or credit forms.
If you claim the estimated tax credit shown on line 9a, attach a copy of Schedule K-1 to the Hawaii income tax return you file.
If the schedule is corrected, make sure the estate or trust sends a copy of the corrected Schedule K-1 to the Hawaii Department of Taxation. The supplied text does not provide a mailing address or e-filing instructions.
Common mistakes
- Changing an incorrect Schedule K-1 yourself. Notify the fiduciary and request a corrected schedule instead. Make sure the estate or trust sends the corrected copy to the Hawaii Department of Taxation.
- Ignoring differences between federal and Hawaii amounts. Form N-11 filers must make necessary adjustments on the Hawaii Additions Worksheet and/or Hawaii Subtractions Worksheet when the two schedules differ.
- Forgetting the attachment for line 9a. Attach a copy of Schedule K-1 to your Hawaii income tax return to substantiate the estimated tax credit.
- Overlooking passive activity limits. The instructions caution that passive activity loss limitations under IRC section 469 apply to estates and trusts.
Questions people ask
What should I do if my Schedule K-1 is wrong?
Notify the estate’s or trust’s fiduciary and ask for a corrected Schedule K-1. Do not change items on your copy. Make sure the estate or trust sends the corrected copy to the Hawaii Department of Taxation.
What does the “Final K-1” box mean for deductions?
If the fiduciary checked this box, you may be allowed to deduct excess deductions from the estate’s or trust’s final year and certain unused carryovers on your individual income tax return, subject to limitations.
Where do I find the worksheets referenced for Form N-15?
The referenced worksheets are in the Form N-15 instructions.
What do lines 10 through 13 show for nonresident beneficiaries?
They show interest, dividends, other intangible income, and capital gains or losses from the sale of intangibles that are not subject to Hawaii tax. The stated exclusion does not apply to income received from real property held in a land trust formed under Chapter 558, HRS.