I have a K1 form. It only has values filled in 11A and 11C. When I enter the form into turbo tax my refund goes up? Can you please explain why ?

[Carl]

What kind of K-1? It matters. 1065 K-1? 1120-S K-1? Another type?

[dickeyb]

This is a 2018 Schedule K1 (form 1041).  This is from my mothers trust.  By the time the estate was settled there was no income distributed and all money went to pay her final expenses. I would guess the expenses was the deductions that were distributed to her Heirs and shown as 11A-
Excess deduction and 11C - Long term capital loss carryover.

[Ashby]

Yes, that's correct. Claiming these losses from the K-1 lowers your taxable income and increases your refund. Sorry for the loss of your Mom.

[dickeyb]

Thanks for the information.  Did not understand how I could get a tax break from the deductions when it is my understanding that money inherited is not taxed (am I wrong about that?).

[Carl]

Perceived gains from an inheritance are taxable. Then depending on other factors, the loss may or may not be deductible. For example, if you inherited an investment that was worth $5000 on the day she passed (not the day you inherited it) and then you "sold" it for zero dollars, you have a $5000 investment loss.

[Ashby]

What @Carl said ^^. You have a "basis" in your investments on the day she passed (what it's worth that day). Where it goes from that day forward is your gain or loss. (The difference between value when she passed and when it sold)

[Ashby]

Yes, it sounds like this K-1 as either from a trust or a partnership. Final year deductions are reported in Box 11 from an estate or trust using codes A and C.

If it is a 1065 partnership K-1, there can be investment losses reported this way.

Either instance could increase your refund.