Schedule J (Form 1041)—Accumulation

The following actions or transactions in 2025, alone, generally don’t require you to check “Yes.”

Holding a digital asset in a wallet or account.
Transferring a digital asset from one wallet or account you own or control to another wallet or account that you own or control.

For example, check “Yes” if at any time during 2025 you:

Received digital assets as payment for property or services provided;
Received digital assets as a result of a reward or award;
Received new digital assets as a result of mining, staking, and similar activities;
Received digital assets as a result of a hard fork;
Disposed of digital assets in exchange for property or services;
Disposed of a digital asset in exchange or trade for another digital asset;

General Instructions Use Schedule J (Form 1041) to report an accumulation distribution for a domestic complex trust that was:

Previously treated at any time as a foreign trust (unless an exception is provided in future regulations); or
Created before March 1, 1984, unless that trust would not be aggregated with other trusts under the rules of section 643(f) if that section applied to the trust.

An accumulation distribution is the excess of amounts properly paid, credited, or required to be distributed (other

Sold a digital asset; or

40 Instructions for Form 1041 (2025)

than income required to be distributed currently) over the DNI of the trust reduced by income required to be distributed currently. To have an accumulation distribution, the distribution must exceed the accounting income of the trust.

Specific Instructions

Part I—Accumulation Distribution in 2025

Line 1—Distribution Under Section 661(a)(2)

Enter the amount from Form 1041, Schedule B, line 10, for 2025. This is the amount properly paid, credited, or required to be distributed other than the amount of income for the current tax year required to be distributed currently.

Line 2—Distributable Net Income

Enter the amount from Form 1041, Schedule B, line 7, for 2025. This is the amount of DNI for the current tax year determined under section 643(a).

Line 3—Distribution Under Section 661(a)(1)

Enter the amount from Form 1041, Schedule B, line 9, for 2025. This is the amount of income for the current tax year required to be distributed currently.

Line 5—Accumulation Distribution

If line 11 of Form 1041, Schedule B, is more than line 8 of Form 1041, Schedule B, complete the rest of Schedule J and file it with Form 1041, unless the trust has no previously accumulated income.

Generally, amounts accumulated before a beneficiary reaches age 21 may be excluded by the beneficiary. See sections 665 and 667(c) for exceptions relating to multiple trusts. The trustee reports to the IRS the total amount of the accumulation distribution before any reduction for income accumulated before the beneficiary reaches age 21. If the multiple trust rules don’t apply, the beneficiary claims the exclusion when filing Form 4970, as you may not be aware that the beneficiary may be a beneficiary of other trusts with other trustees.

For examples of accumulation distributions that include payments from one trust to another trust, and amounts distributed for a dependent’s support, see Regulations section 1.665(b)-1A(b).

Part II—Ordinary Income Accumulation Distribution Enter the applicable year at the top of each column for each throwback year.

Line 6—DNI for Earlier Years

Enter the applicable amounts as follows.

Throwback year(s) Amount from line

1969–1977 . . . . . . . . Form 1041, Schedule C, line 5 1978–1979 . . . . . . . . Form 1041, line 61 1980 . . . . . . . . . . . . Form 1041, line 60 1981–1982 . . . . . . . . Form 1041, line 58 1983–1996 . . . . . . . . Form 1041, Schedule B, line 9 1997–2024 . . . . . . . . Form 1041, Schedule B, line 7

For information about throwback years, see the instructions for line 13. For purposes of line 6, in figuring the DNI of the trust for a throwback year, subtract any estate tax deduction for IRD if the income is includible in figuring the DNI of the trust for that year.

Line 7—Distributions Made During Earlier Years

Enter the applicable amounts as follows.

Throwback year(s) Amount from line

1969–1977 . . . . . . . . Form 1041, Schedule C, line 8 1978 . . . . . . . . . . . . Form 1041, line 64 1979 . . . . . . . . . . . . Form 1041, line 65 1980 . . . . . . . . . . . . Form 1041, line 64 1981–1982 . . . . . . . . Form 1041, line 62 1983–1996 . . . . . . . . Form 1041, Schedule B, line 13 1997–2024 . . . . . . . . Form 1041, Schedule B, line 11

Line 11—Prior Accumulation Distribution Thrown Back to Any Throwback Year

Enter the amount of prior accumulation distributions thrown back to the throwback years. Don’t enter distributions excluded under section 663(a)(1) for gifts, bequests, etc.

Line 13—Throwback Years

Allocate the amount on line 5 that is an accumulation distribution to the earliest applicable year first, but don’t allocate more than the amount on line 12 for any throwback year. An accumulation distribution is thrown back first to the earliest preceding tax year in which there is undistributed net income (UNI). Then, it is thrown back beginning with the next earliest year to any remaining preceding tax years of the trust. The portion of the accumulation distribution allocated to the earliest preceding tax year is the amount of the UNI for that year. The portion of the accumulation distribution allocated to any remaining preceding tax year is the amount by which the accumulation distribution is larger than the total of the UNI for all earlier preceding tax years.

A tax year of a trust during which the trust was a simple trust for the entire year isn’t a preceding tax year unless (a) during that year, the trust received outside income; or (b) the trustee didn’t distribute all of the trust’s income that was required to be distributed currently for that year. In this case, UNI for that year must not be more than the greater of the outside income or income not distributed during that year.

The term “outside income” means amounts that are included in the DNI of the trust for that year but that aren’t “income” of the trust as defined in Regulations section 1.643(b)-1. Some examples of outside income are (a) income taxable to the trust under section 691, (b) unrealized accounts receivable that were assigned to the trust, and (c)

Instructions for Form 1041 (2025) 41

distributions from another trust that include the DNI or UNI of the other trust.

Line 16—Tax-Exempt Interest Included on Line 13

For each throwback year, divide line 15 by line 6 and multiply the result by the following.

Throwback year(s) Amount from line

1969–1977 . . . . . . . . Form 1041, Schedule C, line 2(a) 1978–1979 . . . . . . . . Form 1041, line 58(a) 1980 . . . . . . . . . . . . Form 1041, line 57(a) 1981–1982 . . . . . . . . Form 1041, line 55(a) 1983–2024 . . . . . . . . Form 1041, Schedule B, line 2

Part III—Taxes Imposed on Undistributed Net Income For the regular tax computation, if there is a capital gain, complete lines 18 through 25 for each throwback year. If the trustee elected the alternative tax on capital gains, complete lines 26 through 31 instead of lines 18 through 25 for each applicable year. If there is no capital gain for any year, or there is a capital loss for every year, enter on Part II, line 9, the amount of the tax for each year identified in the instruction for line 18 and don’t complete Part III. If the trust received an accumulation distribution from another trust, see Regulations section 1.665(b)-1A.

Note: The alternative tax on capital gains was repealed for tax years beginning after December 31, 1978. The maximum rate on net capital gain for 1981, 1987, and 1991 through 2024 isn’t an alternative tax for this purpose.

Line 18—Regular Tax

Enter the applicable amounts as follows.

Throwback year(s) Amount from line

1969–1976 . . . . . . . . . Form 1041, page 1, line 24 1977 . . . . . . . . . . . . . Form 1041, page 1, line 26 1978–1979 . . . . . . . . . Form 1041, line 27 1980–1984 . . . . . . . . . Form 1041, line 26c 1985–1986 . . . . . . . . . Form 1041, line 25c 1987 . . . . . . . . . . . . . Form 1041, line 22c 1988–2024 . . . . . . . . . Form 1041, Schedule G, line 1a

Line 19—Trust’s Share of Net Short-Term Gain

For each throwback year, enter the smaller of the capital gain from the two lines indicated. If there is a capital loss or a zero on either or both of the two lines indicated, enter zero on line 19.

Throwback year(s) Amount from line

1969–1970 . . . . . . . . . . . . . Schedule D, line 10, column 2; or

Schedule D, line 12, column 2 1971–1978 . . . . . . . . . . . . . Schedule D, line 14, column 2, or

Schedule D, line 16, column 2 1979 . . . . . . . . . . . . . . . . . Schedule D, line 18, column (b); or

Line 22—Taxable Income

Enter the applicable amounts as follows.

Throwback year(s) Amount from line

1969–1976 . . . . . . . . . . Form 1041, page 1, line 23 1977 . . . . . . . . . . . . . . Form 1041, page 1, line 25 1978–1979 . . . . . . . . . . Form 1041, line 26 1980–1984 . . . . . . . . . . Form 1041, line 25 1985–1986 . . . . . . . . . . Form 1041, line 24 1987 . . . . . . . . . . . . . . Form 1041, line 21 1988–1996 . . . . . . . . . . Form 1041, line 22 1997 . . . . . . . . . . . . . . Form 1041, line 23 1998–2018 . . . . . . . . . . Form 1041, line 22 2019–2024 . . . . . . . . . . Form 1041, line 23

Schedule D, line 20, column (b) 1980–1981 . . . . . . . . . . . . . Schedule D, line 14, column (b); or

Schedule D, line 16, column (b) 1982 . . . . . . . . . . . . . . . . . Schedule D, line 16, column (b); or

Schedule D, line 18, column (b) 1983–1996 . . . . . . . . . . . . . Schedule D, line 15, column (b); or

Schedule D, line 17, column (b)

1997–2002 . . . . . . . . . . . . . Schedule D, line 14, column (2); or

Schedule D, line 16, column (2) 2003 . . . . . . . . . . . . . . . . . Schedule D, line 14a, column (2); or

Schedule D, line 16a, column (2) 2004–2012 . . . . . . . . . . . . . Schedule D, line 13, column (2); or

Schedule D, line 15, column (2) 2013–2024 . . . . . . . . Schedule D, line 17, column (2); or

Schedule D, line 19, column (2)

Line 20—Trust’s Share of Net Long-Term Gain

Enter the applicable amounts as follows.

Throwback year(s) Amount from line

1969–1970 . . . . . . . . . . . . 50% of Schedule D, line 13(e)

1971–1977 . . . . . . . . . . . . 50% of Schedule D, line 17(e)

1978 . . . . . . . . . . . . . . . . Schedule D, line 17(e) or line

31, whichever is applicable, less Form 1041, line 23 1979 . . . . . . . . . . . . . . . . Schedule D, line 25 or line 27,

whichever is applicable, less

Form 1041, line 23 1980–1981 . . . . . . . . . . . . Schedule D, line 21, less

Schedule D, line 22 1982 . . . . . . . . . . . . . . . . Schedule D, line 23, less

Schedule D, line 24 1983–1986 . . . . . . . . . . . . Schedule D, line 22, less

Schedule D, line 23 1987–1996 . . . . . . . . . . . . Schedule D, the smaller

whichever is applicable, less

of any gain on line 16 or line 17, column (b)

1997–2001 . . . . . . . . . . . . Schedule D, the smaller of any gain on line 15c or

line 16, column (2)

2002 . . . . . . . . . . . . . . . . Schedule D, the smaller of any gain on line 15a or

line 16, column (2)

2003 . . . . . . . . . . . . . . . . Schedule D, the smaller of any gain on line 15a or

line 16a, column (2) 2004–2012 . . . . . . . . . . . . Schedule D, the smaller

of any gain on line 14a

or line 15, column (2)

2013–2024 . . . . . . . . . . . . Schedule D, the smaller of any gain on line 18a or

line 19, column (2)

42 Instructions for Form 1041 (2025)

Line 26—Tax on Income Other Than Long-Term Capital Gain

Enter the applicable amounts as follows.

Throwback year(s) Amount from line

1969 . . . . . . . . . . . . . . Schedule D, line 20 1970 . . . . . . . . . . . . . . Schedule D, line 19 1971 . . . . . . . . . . . . . . Schedule D, line 50 1972–1975 . . . . . . . . . . Schedule D, line 48 1976–1978 . . . . . . . . . . Schedule D, line 27

Line 27—Trust’s Share of Net Short-Term Gain

If there is a loss on any of the following lines, enter zero on line 27 for the applicable throwback year. Otherwise, enter the applicable amounts as follows.

Throwback year(s) Amount from line

1969–1970 . . . . . . . Schedule D, line 10, column 2 1971–1978 . . . . . . . Schedule D, line 14, column 2

Line 28—Trust’s Share of Taxable Income Less Section 1202 Deduction

Enter the applicable amounts as follows.

Throwback year(s) Amount from line

1969 . . . . . . . . . . . . . . . . Schedule D, line 19 1970 . . . . . . . . . . . . . . . . Schedule D, line 18 1971 . . . . . . . . . . . . . . . . Schedule D, line 38 1972–1975 . . . . . . . . . . . . Schedule D, line 39 1976–1978 . . . . . . . . . . . . Schedule D, line 21

Part IV—Allocation to Beneficiary Complete Part IV for each beneficiary. If the accumulation distribution is allocated to more than one beneficiary, attach an additional copy of Schedule J with Part IV completed for each additional beneficiary. Give each beneficiary a copy of their respective Part IV information. If more than 5 throwback years are involved, use another Schedule J, completing Parts II and III for each additional throwback year.

If the beneficiary is a nonresident alien individual or a foreign corporation, see section 667(e) about retaining the character of the amounts distributed to determine the amount of the U.S. withholding tax.

The beneficiary uses Form 4970 to figure the tax on the distribution. The beneficiary also uses Form 4970 for the section 667(b)(6) tax adjustment if an accumulation distribution is subject to estate or GST tax. This is because the trustee can’t be the estate or GST tax return filer.