When entering K-1 income, it's asking the state or tax-exempt income reported from a trust. Is it the state where the trust was or where the beneficiary lives?

[tagteam · Accepted solution]

The tax-exempt income is typically earned by the trust in more than one state. However, you should check with the trustee (or other responsible party) for confirmation. 

Regardless, the state (or states) will be where the trust derived the tax-exempt income, which will not necessarily be where the beneficiaries reside.