Rest assured you won't be double taxed because anything entered in Box 14 is informational and won't be reported as taxable income. How is how to properly report this information.
When yo begin reporting your k-1 (1041). After you record your initial information, Be sure to check the boxes that are relevant to your return. From what i can see, you will check boxes 1-5 and box 14.
- In the next screen, record the information in Boxes 2A and 2B. This should be the only taxable income on the k-1 to be reported in your return. don't record anything in Boxes 3-5.
- in Box 14, select B in the drop-down arrow and enter $565 as the amount.
- in the first screen, enter $5779 for gross income reported at Beneficiary level. Now enter $5384 as Gross income Sourced at Beneficiary level Foreign Sourced income. The middle column here should default to $395. Again, this will have no impact on your tax return.
- Next screen should indicate this is passive income.
- For the beneficiary deductions., record $6068 for other deductions total and other deductions foreign source As $6068. The other deductions at US Source should default to 0.
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