There appears to be an error in the Colorado State Tax (Business/State) edition when complex trusts distribute income and principle or have a charitable distribution.
The denominator for the calculations on the Colorado Sch K-1 Line 1 is from form 1041, Schedule B, Line 7 (Distributable Net Income).
The numerator for the calculations on the Colorado Sch K-1 Line 1 is a proportion of Line 1 from form Colorado K-1 Worksheet which comes from 1041, Schedule B, Line 10 (Total Distribution). This is the error. This proportion should also be from form 1041, Schedule B, Line 7 (Distributable Net Income) per the Form 105 book and to maintain unity in the calculations in Schedule B.
The current implementation only works for simple trusts that only distribute up to the Distributable Net Income and do not make charitable contributions.
See Colorado Form 105, p3-4: Sch B subtotal percent should not be greater than 100% for a detailed example.
TurboTax Support: Please correct this issue in TurboTax Business or explain where I am mistaken.
