Problems with IRS processing of 1041-T

[KFCPA]

Anyone else having problems with IRS processing delays for a timely filed form 1041-T to allocated trust estimated tax payments to the beneficiaries SSN?

We're having numerous discussions with IRS and puzzled by the long hold-up. In the meantime, the beneficiaries are receiving CP23 notices for underpayment, when in reality, they are due refunds.

Ironic that the IRS picks up the income from K-1, but not line 13A tax payments. We've even submitted EFTPS receipts, sigh.

In the future, should we just have the beneficiaries make tax payments themselves?

[IRonMaN · Accepted solution]

"In the future, should we just have the beneficiaries make tax payments themselves?"

That's the way it is supposed to work so that would be a good idea.

[KFCPA]

Thanks for your reply Iron Man. Frustrating that my TTB Deluxe Edition tax guide didn't offer that advice. 😞

[IRonMaN]

You betcha!

[KFCPA]

I just got off phone with IRS Practitioners Priority line. Agent stated that IRS has recently begun to withhold and investigate all trust refunds and the 1041 return is stuck in the Return Integrity Compliance Services (RICS) dept. Now to fax documents to them!