Updated October 18, 2026. Quick answer: Parts II and III spread the line 5 accumulation distribution back over earlier years of the trust and then work out the tax on the undistributed income for each of those years. The inputs are the trust’s returns for the throwback years. The line-by-line figures are normally computed by the trustee’s preparer from those old returns, so this page explains the structure and leaves the year tables to the instructions.
What Parts II and III do
Part II is titled “Ordinary Income Accumulation Distribution” and Part III “Taxes Imposed on Undistributed Net Income”. The instructions for Part II begin “Enter the applicable year at the top of each column for each throwback year.” The line 5 amount comes from Part I, and the resulting allocation goes to each beneficiary in Part IV.
Line 13: earliest year first
“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.” On the order: “An accumulation distribution is thrown back first to the earliest preceding tax year in which there is undistributed net income (UNI).” For information about throwback years generally, the instructions for line 6 send you to line 13.
Line 11 and the more-than-5-years rule
Line 11: “Enter the amount of prior accumulation distributions thrown back to the throwback years.” The same instruction adds “Don’t enter distributions excluded under section 663(a)(1) for gifts, bequests, etc.”
The five columns on the form are not a limit. Part III repeats the note “Note: If more than 5 throwback years are involved, attach additional schedules.” The Part IV instructions say the same thing: “If more than 5 throwback years are involved, use another Schedule J, completing Parts II and III for each additional throwback year.”
Part III: which lines to complete
“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.” The instructions also say “The alternative tax on capital gains was repealed for tax years beginning after December 31, 1978.”
If there is nothing to compute: “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.”
Where the numbers come from
The line 6 to 9 and line 18 to 31 figures are copied from the trust’s old returns, and the instructions give a table by year that says which line of which year’s return to use. Those tables are not reproduced here: the right line depends on the year, so use the table in the instructions edition and the return for each throwback year. This is the part of the schedule where a preparer’s records matter most.
Where it goes next
The Part III results feed Part II, line 9, and the form says to enter the tax “Enter here and on page 1, line 9”. The beneficiary’s share of each year is then set out in Part IV. The wider return is described on the Form 1041 for estates page.
Edition and line numbers
This page reads Schedule J (Form 1041) for 2025 and the Instructions for Form 1041 for 2025. Those are the current files irs.gov served on 2026-10-18. The form is captioned “Part I Accumulation Distribution in 2025” and each page of the instructions carries the footer “Instructions for Form 1041 (2025)”. Check the revision date printed on your own Schedule J and use that revision’s line numbers, because a different revision can number or word its lines differently.
Common mistakes
- Spreading the distribution evenly. The instructions say to allocate it “to the earliest applicable year first”.
- Stopping at five columns. The form says “If more than 5 throwback years are involved, attach additional schedules.”
- Completing both tax blocks. The instructions say lines 26 through 31 are completed “instead of lines 18 through 25” when the alternative tax was elected.
Related: Schedule J (Form 1041), Schedule J Part I, capital gains stay in the trust, and Form 1041 for estates.
Sources
- Instructions for Form 1041 and Schedules A, B, G, J, and K-1 (2025): https://www.irs.gov/pub/irs-pdf/i1041.pdf
- Schedule J (Form 1041), Accumulation Distribution for Certain Complex Trusts (2025): https://www.irs.gov/pub/irs-pdf/f1041sj.pdf
Read from the IRS documents linked above on October 18, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.