Schedule K-1 for Trust (questions as trustee and beneficiary)

[loneshadow]

Good morning!

I am both the trustee and a beneficiary on my parents' trust (and using Home and Business in addition to Business).  This is the first year that there are been distributions to beneficiaries.  When I look at the K-1 that I created for myself, one of the lines in Box 14 shows "I" and "STMT".  After reading other posts on here, I understand that STMT refers to a statement that should have more information on amounts that the beneficiary would use for their taxes.  However, the only additional document that is included is called "Beneficiary's Share of Income, Deductions, Credits, etc." and the information listed refers to Box 9.  In Turbo Tax Business, I see a Statement A in the Forms section, but it didn't print out with the Schedule K-1 and the information on it is confusing when trying to apply it to the questions asked in Home and Business.

Here are my questions:

• Should a statement have printed out with the K-1?  If so, what will it look like and how do I get that to happen?  If not, how should the beneficiary handle Box 14?
• If the Statement A is the correct document, how do I determine which of those numbers gets entered in to the beneficiary's tax return?  I will need this info for myself as well as for the other beneficiaries.

I would be grateful for any guidance available on this challenge I am having.

Thank you!

Zak

[Anonymous_ · Accepted solution]

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@loneshadow wrote:
Should a statement have printed out with the K-1?  If so, what will it look like and how do I get that to happen? 

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Yes, the statement should have printed out with the return and K-1 and that should occur automatically if the statement is populated with any figure or figures.

[Anonymous_ · Accepted solution]

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@loneshadow wrote:
If the Statement A is the correct document, how do I determine which of those numbers gets entered in to the beneficiary's tax return?

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If you (and your beneficiaries) are using TurboTax, the program will ask for the information when the code for Line 14 on the K-1 is entered into the K-1 section.

[loneshadow]

Hi TagTeam!

Thanks for the replies!

I need some clarification on you answers, if you have time.

There is a tab for distributions that allows you to print out the K-1s.  It includes the cover letter and codes and the extra sheet I referenced.  Do you know why  the Statement isn't included?

Regarding how to input the information as a beneficiary, I am not sure how to apply the info on the form to the questions asked in TT.  There are 2 columns, both say the name of the property, and one has "Prev disallowed losses".  Both column have an amount for Rental Income and the first column also has an amount for UBIA of Qualified Property. 

• Which number (the one in the 1st column or the one in the Prev disallowed losses column (or do I add them together?) do I include in the Enter Box 14 Info? They are negative numbers....should they be entered as negative?  Or, do I leave that blank?
• There is then a screen called "Passive Loss Carryovers" that specifically says to enter it as a negative number.  Is this were I would enter the "Prev disallowed losses" number?
• There is then a screen called Qualified Business Income Carryovers.  Would this number be on this form?
• There is then a question that asks if the Section 199A income from Box 14 includes business income from a business held by the trust.  The two options are Yes or that the only source is Section 199A dividends (also called REIT dividends.  The second option doesn't seem right, but if I choose the first one, it says to enter the business name and EIN (and says this would be separate from the name and business of the Trust, which is isn't.  Any thoughts as to how to answer this question?

[Anonymous_ · Accepted solution]

I suspect (but am not certain) that the Distributions section may only print out the K-1s but not any other statements that should be issued to the beneficiaries.

Frankly, I have no idea about the carryovers or suspended losses because I do not know the history of the trust and cannot see the actual return. 

With respect to the Section 199A issue, the beneficiaries would check "Yes" and enter the name and EIN of the trust. Thereafter, they would check the boxes that correspond with Statement A (this assumes they are using TurboTax).

[loneshadow]

Thanks so much!

I contacted Turbo Tax support and they said that there is a program glitch that is preventing that statement to be printed using the Distribute K-1s info.

They also helped me understand the other issues and I feel that this issue is now resolved.  Thank you!