Review of tax software for trusts and estates

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
geobrick
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Re: Review of tax software for trusts and estates

Post by geobrick » Sun Mar 11, 2018 3:54 pm

tryonthis wrote:
Sun Mar 11, 2018 12:35 pm
I downloaded TaxAct last year for 2 irrevocable trusts and was surprised when it would not allow me to do the second trust. That was false advertising. In any case, I got around it by moving the first Trust file to a different location and starting from scratch with the second. I mailed in the returns.
I suspected this might be the case after seeing what FBN2014 posted. I downloaded Tax Act Estates and Trusts anyway (two trusts at $60 each is still less then TurboTax business). I just wanted to try something new this year. I also downloaded TaxAct Plus for my 1040 returns (I have to do 5 of them). I like the way TaxAct combines all the downloaded products into a single interface. I'm currently having an issue loading the Trust return into TaxAct but will post that issue separately instead of it being buried here.

Turobtax has been pretty good but both TurboTax and TaxAct have had some pretty serious problems for me that increased my tax burden. I've written about both in previous posts but to recap; 1) TurboTax Business changed my Trust type in 2016 without warning which changed the exemption amount from $4,050 to $100 (big affect on tax owed). I had to file an amended return when I discovered what was happening. I found the same issue exists in TT Business 2017 but now that I know it, I could work around it (If I were using it this year). 2) Last year (2016), for comparison, I tried out TaxAct Online and found out it didn't properly calculate the taxes on qualified dividends (it just used the tax schedule rates for income). Their tech support acknowledged the problem but said it would not get fixed before the filing deadline. I verified it's fixed in 2017 however when I opened the old 2016 trial return on their website yesterday, the miscalculation was still there. Does that mean they never fixed the 2016 version? Maybe I should restart a 2016 return to see if starting new reveals the fix. Maybe I was the only one in 2016 who had this unique problem (or the only one that noticed it) so they never went back to fix it.

I'd use a professional to do my taxes but I really don't think it would be a time saver in my case. I've found that I still have to do all the work gathering all the information they'd need and explaining my situation. Then afterwards I'd spend time reviewing what they did. Maybe after a few years I'd become comfortable with them and trust their returns without a significant review. I find once I have all the information gathered, it's just a matter of entering it all into the tax software.
Last edited by geobrick on Mon Mar 26, 2018 3:25 pm, edited 1 time in total.

geobrick
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Re: Review of tax software for trusts and estates

Post by geobrick » Mon Mar 26, 2018 3:25 pm

I just wanted to update my thoughts so far on switching to TaxAct from TurboTax this year.

I downloaded TaxAct Plus for filing five 1040 returns and four CA state returns. I like it fine.

I also downloaded TaxAct Estates and Trusts for two special needs trusts I manage. I'm still not sure if TaxAct will let me file more than one return with this version but it does let me create and save more than one return. There is however an issue when opening the 1041 returns (the workaround I discovered is to first open a 1040 return then open the 1041 return).

In addition to the issue of opening the 1041 files, I'm seeing a tax calculation error on one of the CA 541 returns (I've posted the details in another post - it's related to the Trust Type and the non-CA residency of the beneficiary).

I've tried to contact their support about the issues above which leads to my biggest gripe so far with TaxAct; Their apparent lack of support. For the last two weeks, I've been trying to reach them by phone, email or through their website and have gotten nothing back except in the case of the emails where I got an acknowledgement the email was received. This is a big change from my experience last year when I was just trying out their products online and found an issue. They got back to me right away back then. It's the primary reason I decided to switch to taxact this year. Maybe the old mutual fund caveat applies here, past performance is no guarantee of future results.

I'll probably end up filing the problem return by 'not' selecting the box for an out of state beneficiary. That works because the tax calculated this way happens to be correct for my situation (and comes out to what it should be if I properly selected the non-resident beneficiary box). Claiming all trusties and beneficiaries are CA residents might confuse the California Franchise Tax Board because the beneficiary's address is in Florida. If they notice I may get a letter asking me why there's no CA 540 filed for the beneficiary. Then I'll have to write them back and may end up needing to file a manually produced amendment (since the taxact issue is that it doesn't produce the correct schedule G on the 541). It's a risk but my only option at this point.

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plannerman
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Re: Review of tax software for trusts and estates

Post by plannerman » Mon Mar 26, 2018 3:43 pm

[/quote]

1) TurboTax Business changed my Trust type in 2016 without warning which changed the exemption amount from $4,050 to $100 (big affect on tax owed).
[/quote]

Simple trusts get $300 exemptions
Complex trusts get $100 exemptions

What kind of trusts get $4,050 exemptions?

plannerman

geobrick
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Re: Review of tax software for trusts and estates

Post by geobrick » Mon Mar 26, 2018 8:23 pm

plannerman wrote:
Mon Mar 26, 2018 3:43 pm

Simple trusts get $300 exemptions
Complex trusts get $100 exemptions

What kind of trusts get $4,050 exemptions?

plannerman
Qualified Disability Trusts get a $4,050 exemption. If you're using Turbo Tax, you have to be in the 'Federal Taxes' Section under the 'Other' tab to select 'Type of Trust' and check the box "This is different kind of trust" which will reveal the option to select it among three other types of trusts. Then once it's selected, verify it stayed selected because it gets reset to complex whenever you change or even just visit the distributions section.

panic-stricken
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Re: Review of tax software for trusts and estates

Post by panic-stricken » Wed Apr 04, 2018 4:37 pm

I'm late as usual, so I just started on a complex trust with no K1's. I assumed it would import my year-end 1099 Composite brokerage statement (like other tax programs I've used), but if it does, I don't know how. It's asking me to manually enter all 1099-INT and 1099-DIV information. My 1099-Composite is 24 pages long and there is no way I even know how to find all the right information let alone enter it.

Can someone please provide the name of a tax software package that *will* import my 1099 statement? Please? I feel a panic attack coming on... :-)

panic-stricken
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Re: Review of tax software for trusts and estates

Post by panic-stricken » Wed Apr 04, 2018 6:09 pm

Just a quick follow-up to my previous post: I thought I'd found my answer in H&R Block Premium & Business, but when I read the reviews on Amazon, most people give it 1 or 2 stars. If I look at H&R's website, under feature comparisons, it says it *can* "easily import ... 1099 statements", but I'm not sure if that applies to the Business software part - apparently in 2016, there were two programs that came with "Premium & Business", so does the Business program in fact support importing a 1099? I don't know. For $40, I could just try it, but with such poor ratings I think it might be foolish.

So maybe a better question is, of the software discussed in this thread, which one(s) (if any) can import my 1099 Composite? And if the answer is none, then I'm back to my original question.

Thank you.

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bostondan
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Re: Review of tax software for trusts and estates

Post by bostondan » Wed Apr 04, 2018 7:19 pm

panic-stricken wrote:
Wed Apr 04, 2018 6:09 pm
Just a quick follow-up to my previous post: I thought I'd found my answer in H&R Block Premium & Business, but when I read the reviews on Amazon, most people give it 1 or 2 stars. If I look at H&R's website, under feature comparisons, it says it *can* "easily import ... 1099 statements", but I'm not sure if that applies to the Business software part - apparently in 2016, there were two programs that came with "Premium & Business", so does the Business program in fact support importing a 1099? I don't know. For $40, I could just try it, but with such poor ratings I think it might be foolish.

So maybe a better question is, of the software discussed in this thread, which one(s) (if any) can import my 1099 Composite? And if the answer is none, then I'm back to my original question.

Thank you.
TaxAct can definitely import 1099s. It wasn't great, but it works. It is buried somewhere in the section after you complete the guided steps for federal information. You have to expand a couple things to find the import option.
“There may be times when we are powerless to prevent injustice, but there must never be a time when we fail to protest.” - Elie Wiesel

panic-stricken
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Re: Review of tax software for trusts and estates

Post by panic-stricken » Thu Apr 05, 2018 2:40 pm

Thanks for your response, but I still can't find any such capability. I may not have been specific enough - I'm talking about TaxAct for Trusts/Estates, i.e., generating a 1041 and associated forms.

If you were addressing the Trusts/Estates version, please consider giving me more specific information. When I search for "import 1099-DIV", there is no answer. If I search for just the statement name, I can't find anything about importing, just how to enter the info via interview or typing the info onto the form.

So far, this is what I have found (corrections are welcome)

H&R Block Premium & Business (Amazon download, I have not tried it) -
imports 1099-DIV and 1099-INT, but not 1099-B

TaxAct for Trusts & Estates (online version, maybe download version is different?) -
I cannot find any way to import any statement (1099-DIV, 1099-INT, 1099-B)

TurboTax Business - Same as TaxAct, verified in their help section, "...unlike our products
for personal returns, Turbotax Business cannot import any brokerage statements..." (or words to that effect).

Surely SOMEONE sells a product for preparing a return for a trust that can actually import all the statements one might receive?

Thank you all for any assistance you might provide.

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bostondan
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Re: Review of tax software for trusts and estates

Post by bostondan » Thu Apr 05, 2018 8:10 pm

panic-stricken wrote:
Thu Apr 05, 2018 2:40 pm
Thanks for your response, but I still can't find any such capability. I may not have been specific enough - I'm talking about TaxAct for Trusts/Estates, i.e., generating a 1041 and associated forms.
Yes, I knew which one you were referring to. Here you go:

Federal > Investment Income > Gain or loss on the sale of investments > stock data import
“There may be times when we are powerless to prevent injustice, but there must never be a time when we fail to protest.” - Elie Wiesel

panic-stricken
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Re: Review of tax software for trusts and estates

Post by panic-stricken » Sun Apr 08, 2018 3:13 pm

bostondan wrote:
Thu Apr 05, 2018 8:10 pm
panic-stricken wrote:
Thu Apr 05, 2018 2:40 pm
Thanks for your response, but I still can't find any such capability. I may not have been specific enough - I'm talking about TaxAct for Trusts/Estates, i.e., generating a 1041 and associated forms.
Yes, I knew which one you were referring to. Here you go:

Federal > Investment Income > Gain or loss on the sale of investments > stock data import
I'm either very slow (a real possibility) or there is a difference between the online version (the one I'm testing) and the download version. I don't have that menu option (Federal > Investment Income > Gain or loss...). Can you please confirm which version you used? While you're at it, I also have no import option for dividends or interest, only the option for an "interview" or an option to pop up the actual form any directly type in the information. Does the version you used import 1099-DIV and 1099-INT?

Thank you very much,
JA

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bostondan
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Re: Review of tax software for trusts and estates

Post by bostondan » Sun Apr 08, 2018 7:53 pm

panic-stricken wrote:
Sun Apr 08, 2018 3:13 pm
bostondan wrote:
Thu Apr 05, 2018 8:10 pm
panic-stricken wrote:
Thu Apr 05, 2018 2:40 pm
Thanks for your response, but I still can't find any such capability. I may not have been specific enough - I'm talking about TaxAct for Trusts/Estates, i.e., generating a 1041 and associated forms.
Yes, I knew which one you were referring to. Here you go:

Federal > Investment Income > Gain or loss on the sale of investments > stock data import
I'm either very slow (a real possibility) or there is a difference between the online version (the one I'm testing) and the download version. I don't have that menu option (Federal > Investment Income > Gain or loss...). Can you please confirm which version you used? While you're at it, I also have no import option for dividends or interest, only the option for an "interview" or an option to pop up the actual form any directly type in the information. Does the version you used import 1099-DIV and 1099-INT?

Thank you very much,
JA
I'm using the online version. Honestly, I'm not sure exactly how well the import function works, or what the limitations are, because I entered everything manually. The beauty of a three-fund portfolio is that it is very simple when it comes to taxes.

Here is what my screen looks like:

Image
“There may be times when we are powerless to prevent injustice, but there must never be a time when we fail to protest.” - Elie Wiesel

FBN2014
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Re: Review of tax software for trusts and estates

Post by FBN2014 » Sun Apr 08, 2018 7:58 pm

panic-stricken wrote:
Wed Apr 04, 2018 4:37 pm
I'm late as usual, so I just started on a complex trust with no K1's. I assumed it would import my year-end 1099 Composite brokerage statement (like other tax programs I've used), but if it does, I don't know how. It's asking me to manually enter all 1099-INT and 1099-DIV information. My 1099-Composite is 24 pages long and there is no way I even know how to find all the right information let alone enter it.

Can someone please provide the name of a tax software package that *will* import my 1099 statement? Please? I feel a panic attack coming on... :-)
I would suggest that you file for an extension and then hire an accountant who has professional software that can import the data and complete the return. If you didn't distribute all the income from the trust to the beneficiaries then estimate what the tax would be and send it in so you aren't penalized. When you file the return you will get a refund if you overpaid. No need to be panic stricken. :happy
"October is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, September, April, November, May March, June, December, August and February." - M. Twain

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bostondan
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Re: Review of tax software for trusts and estates

Post by bostondan » Sun Apr 08, 2018 8:01 pm

FBN2014 wrote:
Sun Apr 08, 2018 7:58 pm
panic-stricken wrote:
Wed Apr 04, 2018 4:37 pm
I'm late as usual, so I just started on a complex trust with no K1's. I assumed it would import my year-end 1099 Composite brokerage statement (like other tax programs I've used), but if it does, I don't know how. It's asking me to manually enter all 1099-INT and 1099-DIV information. My 1099-Composite is 24 pages long and there is no way I even know how to find all the right information let alone enter it.

Can someone please provide the name of a tax software package that *will* import my 1099 statement? Please? I feel a panic attack coming on... :-)
I would suggest that you file for an extension and then hire an accountant who has professional software that can import the data and complete the return. If you didn't distribute all the income from the trust to the beneficiaries then estimate what the tax would be and send it in so you aren't penalized. When you file the return you will get a refund if you overpaid. No need to be panic stricken. :happy
I agree. I don't think you should be entirely dependent on the ability to import data. If there is "no way [you] even know how to find all the right information" on your 1099s, then perhaps using a professional would be the best choice right now. You can try doing your taxes for practice as well, to see if your calculations match the accountant, so that you feel comfortable doing it yourself next year.
“There may be times when we are powerless to prevent injustice, but there must never be a time when we fail to protest.” - Elie Wiesel

panic-stricken
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Re: Review of tax software for trusts and estates

Post by panic-stricken » Sun Apr 08, 2018 9:06 pm

bostondan wrote:
Sun Apr 08, 2018 7:53 pm
panic-stricken wrote:
Sun Apr 08, 2018 3:13 pm
bostondan wrote:
Thu Apr 05, 2018 8:10 pm

I'm using the online version. Honestly, I'm not sure exactly how well the import function works, or what the limitations are, because I entered everything manually. The beauty of a three-fund portfolio is that it is very simple when it comes to taxes.

Here is what my screen looks like:

<image removed by JA>
Okay, that helped a lot Dan. I really very much appreciate that! Now my problem is that Charles Schwab is not on the list of brokers I can import from directly. At this point, as others have said, I'll get someone to calculate what is owed and then file an extension and try to learn from the CPA how to do it in the future. Interesting that it apparently can import the 1099-B information but there is no attempt to do so for 1099-DIV or -INT. Perhaps it's expected that if we have a business or a trust, we are smarter than the average personal income tax preparer.

Unless someone know how to get Charles Schwab to appear in the list, or knows how to get TaxAct to import a brokerage statement for INT and DIV, I'll stop asking and assume no such program exists. It's hard for me to figure out why these features are missing from this program, but available for most any program used to prepare individual taxes.

Again, thank you to all who responded to my desperate cries for help :-)
Sincerely,
JA

bayview
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Re: Review of tax software for trusts and estates

Post by bayview » Sun Apr 08, 2018 9:12 pm

FBN2014 wrote:
Sun Mar 11, 2018 2:17 pm
bostondan wrote:
Sun Mar 11, 2018 1:18 pm
FBN2014 wrote:
Sun Mar 11, 2018 12:58 pm
tryonthis wrote:
Sun Mar 11, 2018 12:35 pm
I downloaded TaxAct last year for 2 irrevocable trusts and was surprised when it would not allow me to do the second trust. That was false advertising. In any case, I got around it by moving the first Trust file to a different location and starting from scratch with the second. I mailed in the returns.
That's why I switched to TurboTax. I used TaxAct in 2014 (first year I filed trust returns) and in 2015 and it allowed me to do multiple returns. Price was $30. Then in 2016 they doubled the price and never mentioned that it was for one return only (as you said, false or misleading advertising).
Were you able to do multiple trust returns on TurboTax for one state without paying again for each return for the state? I wasn't sure how that would work if I had gone with TurboTax.

TaxAct gave me $15 off each online return just for asking, which was better than nothing.
I'm in NC and the state return isn't available on TurboTax so I will download from state website and type in info. Pretty simple since I just have to transfer info from federal and do a few calculations.
:confused :confused

We’re in NC and just did our taxes in TT, including state.

We use the download/desktop version, not the online version, if that’s relevant.

Or was this just for trust taxes?
The continuous execution of a sound strategy gives you the benefit of the strategy. That's what it's all about. --Rick Ferri

FBN2014
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Re: Review of tax software for trusts and estates

Post by FBN2014 » Mon Apr 09, 2018 7:29 am

bayview wrote:
Sun Apr 08, 2018 9:12 pm
FBN2014 wrote:
Sun Mar 11, 2018 2:17 pm
bostondan wrote:
Sun Mar 11, 2018 1:18 pm
FBN2014 wrote:
Sun Mar 11, 2018 12:58 pm
tryonthis wrote:
Sun Mar 11, 2018 12:35 pm
I downloaded TaxAct last year for 2 irrevocable trusts and was surprised when it would not allow me to do the second trust. That was false advertising. In any case, I got around it by moving the first Trust file to a different location and starting from scratch with the second. I mailed in the returns.
That's why I switched to TurboTax. I used TaxAct in 2014 (first year I filed trust returns) and in 2015 and it allowed me to do multiple returns. Price was $30. Then in 2016 they doubled the price and never mentioned that it was for one return only (as you said, false or misleading advertising).
Were you able to do multiple trust returns on TurboTax for one state without paying again for each return for the state? I wasn't sure how that would work if I had gone with TurboTax.

TaxAct gave me $15 off each online return just for asking, which was better than nothing.
I'm in NC and the state return isn't available on TurboTax so I will download from state website and type in info. Pretty simple since I just have to transfer info from federal and do a few calculations.
:confused :confused

We’re in NC and just did our taxes in TT, including state.

We use the download/desktop version, not the online version, if that’s relevant.

Or was this just for trust taxes?
This was for trust tax return. NC trust return not available in TT.
"October is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, September, April, November, May March, June, December, August and February." - M. Twain

geobrick
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TaxAct Desktop allowed filing more than one Trust return

Post by geobrick » Tue Apr 10, 2018 3:09 am

FBN2014 wrote:
Fri Mar 09, 2018 8:48 pm
geobrick wrote:
Fri Mar 09, 2018 5:14 pm

Thanks. I have posted my question about the Distributions issue and have gotten a quick reply (though the initial reply missed the main point of my question). We'll see if they reply to my follow-up.

Does the TaxAct restriction apply to the downloadable desktop version or only the web version?
I'm pretty sure it applies to both version as I recall asking TaxAct support that exact question. I used the web version.
FBN2014 (and any others interested),
I can confirm you can file more than one Trust return with the desktop version of TaxAct Estates and Trusts. I just finished e-filing my 3rd Trust return today (all including the state return as well).

The only problem you might encounter to make you think it can't be done is an error that appears whenever you try to open a 1041 return. The error says something like "TaxAct Estates and Trusts does not support opening returns other than the default return c:\Users\username\folder\2017 Estates and Trusts Tax Return.te7).". I discovered this when I moved the "default return" file to the folder I wanted to store it and renamed it the way I wanted it named. At that point I only had the one return and couldn't get it to open. The default return in it's original location would open fine.

I discovered a workaround for this once I downloaded the 1040 version. If I opened a 1040 return first, I had no problem opening my 1041 return next. The error would return if the 1041 was the last return you were working on but no big deal. Just click open an existing return and select a 1040 then open the 1041 next. I then created my two additional Trust returns (all different EINs and titles). Each one would open fine using the workaround. More importantly, I was able to efile all three including the state returns (with no additional charges for the state filings - of course I did pay for the state module).

Hope this helps others and I hope it continues to work this way next year (without needing the workaround to open the 1041 files).

darrvao777
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Re: Review of tax software for trusts and estates

Post by darrvao777 » Sun Apr 15, 2018 9:10 pm

Sorry, a bit of a novice question

I played around on legalzoom and created a will and revocable trust. Hasn’t been signed and put into action yet

In talking with others, it really sounds like I should be using an estate lawyer instead of using DIY software

Once I have a revocable trust setup and move my assets in there, there are different rules for taxation that require different software Than the standard TurboTax I’ve been using. Is that correct and the basis for this thread?

(If so, it sounds like I’ll probably want and need an estate lawyer and a CPA. I’m young, I do need a will but this may Be a good reason to defer trust planning until I’m a wee bit older ?)

FBN2014
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Re: Review of tax software for trusts and estates

Post by FBN2014 » Sun Apr 15, 2018 9:22 pm

A revocable trust is not recognized by the IRS as a separate entity. It does not have its own EIN. You would still use your social security number when filing tax returns and you can use regular TurboTax software for filing individual tax returns. If the trust has provisions to maintain assets in trust after your death for your beneficiaries thenyour designated trustee would need to obtain a new EIN to file the trust's tax return.
"October is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, September, April, November, May March, June, December, August and February." - M. Twain

darrvao777
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Re: Review of tax software for trusts and estates

Post by darrvao777 » Sun Apr 15, 2018 10:42 pm

FBN2014 wrote:
Sun Apr 15, 2018 9:22 pm
A revocable trust is not recognized by the IRS as a separate entity. It does not have its own EIN. You would still use your social security number when filing tax returns and you can use regular TurboTax software for filing individual tax returns. If the trust has provisions to maintain assets in trust after your death for your beneficiaries thenyour designated trustee would need to obtain a new EIN to file the trust's tax return.
Gotcha, appreciate the excellent and timely reply! :)

GeraniumLover
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Re: Review of tax software for trusts and estates

Post by GeraniumLover » Tue Aug 14, 2018 10:12 am

With TaxAct online, is there a way to view the Form 1041 prior to paying the fee?

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