561-F: 2024 Form 561-F Oklahoma Capital Gain Deduction for Trusts and Estates Filing Form 513 (2024)
Oklahoma · Oklahoma Tax Commission · Used for tax years 2024
Oklahoma Form 561-F calculates the capital gain deduction for trusts and estates filing Form 513. It reports qualifying Oklahoma capital gains and losses, qualifying capital loss carryovers, and the deduction amount to enter on Form 513.
Who files this form
Form 561-F is for trusts and estates filing Oklahoma Form 513 that claim the Oklahoma capital gain deduction.
Use capital gains and losses included in Form 513, Column B, “Total applicable to Oklahoma,” that have not been distributed to beneficiaries. Do not include amounts included in the income distribution deduction. Beneficiaries compute their capital gain deduction on their own income tax returns.
The deduction applies to qualifying gains included in federal taxable income from eligible Oklahoma property, stock, ownership interests, or business assets that meet the applicable holding period.
What you'll need
Provide Federal Form 1041, Schedule D, and Form(s) 8949.
Depending on the gains reported, also provide:
- Line 1: Form(s) 1099-B if the qualifying gain or loss is reported on Federal Schedule D, line 8a.
- Line 2, installment sales: Federal Form 6252.
- Line 3, other qualifying gains or losses: The applicable federal forms. If those forms do not show the property type, location, sale date, and acquisition date, provide a schedule with that information.
- Line 4, pass-through gains or losses: Federal Schedule K-1 and the worksheet on page 2.
- Line 5, business property: Federal Form 4797. If the gain or loss comes from a Federal Schedule K-1, also provide that K-1 and complete the page 2 worksheet.
Provide a separate worksheet for each piece of property sold. The worksheet asks for the entity’s name and FEIN, property details, acquisition and sale dates, and the dates you acquired ownership in the entity.
Common mistakes
- Including distributed gains or losses: Do not include any portion included in the income distribution deduction on Form 513.
- Reporting the deduction as a beneficiary item: Do not enter any portion of the deduction in Form 513, Part 2, “Beneficiaries’ Share of Income and Deductions.”
- Including gains or losses covered by a pass-through entity election: If you are a direct or indirect member of an electing PTE, amounts covered by the election belong on the PTE’s Form 561-PTE, not this form.
- Using “VARIOUS” or “INHERITED” as the acquisition date: Enter the date you actually acquired the property in Column B, even if the federal form uses those labels.
- Counting the same gain twice: Do not include gains or losses on line 1 that are reported on lines 2 through 5.
- Entering negative amounts on lines 8 through 10: Enter zero on lines 8 and 9 if the result is zero or less. Line 10 is the smaller of lines 8 and 9 and cannot be less than zero.
Questions people ask
What holding periods apply to trusts and estates?
Oklahoma real or tangible personal property must have been owned for at least five uninterrupted years before the sale. Stock or an ownership interest in a qualifying Oklahoma entity must have been owned for at least three uninterrupted years. For a sale of all or substantially all of an Oklahoma entity’s assets, the qualifying property must meet the stated ownership and use requirements for at least three uninterrupted years. A qualifying Oklahoma entity must have had its primary headquarters in Oklahoma for at least three uninterrupted years before the sale.
Can installment-sale gains qualify?
Yes. Use the current year’s taxable portion of the installment payment included in Form 513, Column B, line 6, but not in the income distribution deduction on line 19. The property must have met the applicable holding period when sold. Provide Federal Form 6252.
Does a capital loss carryover reduce the deduction?
A capital loss carryover from qualifying property reduces current-year gains from eligible property. Report the qualifying carryover on line 7 and subtract it from line 6 to calculate line 8.
Where does the final deduction go on Form 513?
Enter the smaller of Form 561-F lines 8 and 9 on line 10 and on Form 513, Part 1, Column B, line 17. Do not enter less than zero.