Thank you.
The trust became irrevocable on Feb 15 and will be closed this year.
I am filing a 1041 short and final return.
The trust itself sold two properties, both reported on 1099-S. After selling expenses, there is a small loss that will track to my K-1.
There is a third property for which I am declaring trust income for two months rental income and I am depreciating for the two month period at the new FMV. The net rental loss will be distributed to my K-1 from Schedule E.
This 3rd property was not sold; rather title was changed to me on April 15, as the beneficiary. My main question is how to handle the disposition of assets section. The cost basis is the FMV on April 15. TT is asking what the sale proceeds amount is. Since the property was not sold, there is no money to report. What do I enter in that field?
Can I disregard the entries for the rental property altogether and simply report the two month renal income and depreciation on my mother's final return, along with the one month that she actually received while living? With the inheritance itself not being taxable, that seems an easy fix, but maybe not appropriate?
To answer your beneficiary questions, her trust also named my sister as a beneficiary, however she passed away a year before my mother.
Thanks for your help
