Tax return reform: Entity-specific fiduciary income tax returns would bring substance to the form

The Tax Cuts and Jobs Act (the Act) is Congress' most recent attempt to simplify our tax system. Even if the Act's catch phrase promise to "file a return on a postcard" is more hyperbole than reality, it is a rallying cry for an equally important aspect of tax reform/tax return reform. Comprehensive tax reform can only be achieved through a combination of simplifying the Internal Revenue Code and the implementing tax forms. Tax forms and instructions are often poorly designed and disorganized, rendering time-efficient and accurately prepared returns problematic. This includes Form 1041, the two-page fiduciary income tax return for nine entities accompanied by 42 pages of disjointed instructions. On all levels, the form misses the mark because (1) too many entities subject to different tax rules use the form; (2) line items and instructions are not consistently sequential; (3) relevant guidance is not easily accessible to the tax return preparer as it is often scattered illogically throughout the instructions; and (4) the information provided in the instructions is often lacking, incomplete, and misleading. To address these inadequacies, this article advocates meaningful tax return reform by which the Internal Revenue Service (IRS) replaces the "one size fits all" Form 1041 with four entity-specific forms and accompanying instructions focused on each type of entity. If the IRS adopts the forms presented in conjunction with this article (or similar versions), the improved forms would be a boon to time-efficient, accurate tax return preparation -- a worthy goal of tax return reform. Keywords: tax reform, Form 1041, income taxation of trusts and estates