sirgalavant
Returning Member

Get your taxes done using TurboTax

OK.  So, after other allowable deductions (line 15a form 1041), the amount left is $13K.  Can my sister now disburse that to herself as a beneficiary (Sch B line 15; line 18 form 1041) and

complete a K-1 to herself with (k-1 form 1041 line 6) Income of

$13K and now report that $13K on her 1040? 

If so, what happens to the $600 exemption (1041 line 21)?  Would she pay taxes on that exemption with the 1041?