A couple of years ago I struggled with TT Business to allocate capital gains to a beneficiary. The trust agreement allows that capital gains can be allocated to income and distributed to beneficiaries. You responded to my question then, but I continue to have problems with the situation. I believe the tests you ran back then on the software were successful because there was one source of income--capital gains. When I have dividends as a second source of income, the software doesn't product a correct answer. The following is a test that I have run:
I use $6,000 of dividends and $4,000 of capital gains, with a distribution of $8,000 to the beneficiary. I've tried every combination on the screens "Allocation of Long-Term Gain" and "Gains Attributable to Income," and either the Schedule D is correct or the K-1 is, but not both, as follows:
Allocation Gains Attributable Sched B DNI Sched D to beneficiary K-1
3,200 3,200 9,200 3,200 2,783
4,000 3,200 9,200 4,000 3,200
3,200 4,000 10,000 3,200 2,855
4,000 4,000 10,000 4,000 3,200
I believe the DNI should be $10,000 and the cap gain distribution to the beneficiary should be $3,200 (80% of the $4,000 cap gain) on both the Sched D and the K-1, but there is no combination that provides that answer. Can you help?
