Income distribution from complex trust

[Lostintrust]

I have 2 parts to income distribution from complex trust.

1) Income is from dividends, interest and rents.  When I enter a distribution, it is increasing the trust income from rents to reflect a reduction in depreciation which is also allocated to the beneficiary on the K-1.  Do I have to pass through depreciation expense or can I elect not to.  if so how?

2) I f I cant do the above I need to make additional distribution.  Where do I elect distribution under the 65 day rule?

[M-MTax]

Depreciation deductions typically follow the income from the asset that generated the deductions.

You can make a 663(b) election in the program, which I believe is toward the end of the interview.

[Lostintrust]

my distribution is less than the income from dividends and interest.  Why can't my income distribution be from those sources?

[Mike9241]

we can't see the trust document which should have a provision for what income can be distributed

whether a Trust can distribute depreciation depends on state law and the thrust document

technically depreciation is allocated to corpus, so either state law or the trust must have a provision to allow distribution. 

[M-MTax]

Unless the trust or state law dictates otherwise, depreciation deductions are allocated between the trust and beneficiaries based on the proportion of accounting income less distributions to accounting income, per Sections 167(d), 611(b)(3) and 642(e).