Simple Trust distributions

Forum|Forum|6 years ago
April 13, 2020
11 replies
96 views

This has been an ongoing issue with TurboTax business and me for years so it's probably something simple that I am doing wrong. It's a irrevocable Simple Trust and designated as such. However, TurboTax allocates all the bank interest and stock dividends to the Trust. For example, this year the Trust earned $500 in interest, $7000 in dividends and $7,000 in capitol gains. The Trust income line 18 is $14,500. The K1 distributions line 18 amount is zero. The amounts on the K1 are zero. I do not know how to fix this.

TurboTax Business Windows

Best answer by Anonymous_

The 1041 module in TurboTax Business can be quirky.

You most likely just need to go through the Distributions section and actually make a distribution to the beneficiaries (even though you should not have to do so in the case of a simple trust).

Anonymous_Answer

Level 15

The 1041 module in TurboTax Business can be quirky.

You most likely just need to go through the Distributions section and actually make a distribution to the beneficiaries (even though you should not have to do so in the case of a simple trust).

WINSOME81

Level 2

i have credit shelter that files as a simple trust . I have distributions , federal tax deduction and state tax deduction. how do Where do I enter the federal tax deduction?

Anonymous

by the way in a simple trust capital gains are genearlly not distributed to benes just ordinary income. However since i can't see the trust document i can't say for sure however from IRS instructions for 1041

Simple Trust
A trust may qualify as a simple trust if:
1. The trust instrument requires that all income must be distributed currently;
2. The trust instrument doesn't provide that any amounts are to be paid, permanently set aside, or used for
charitable purposes; and
3. The trust doesn't distribute amounts allocated to the corpus of the trust.
capital gains are corpus. s if you been distributing them then you have a complex trust.

Anonymous

I would also add that unless the trust document permits corpus distrubtions, if you been distributing them, you may want to consult a lawyer. bad things can happen to the trustee.