dmertz
Level 15

Retirement tax questions

This instructions for Schedule K-1 (Form 1041) indicate that ordinary tax withholding is not eligible to be passed through on the Schedule K-1.  The instructions indicate that only backup withholding (not ordinary withholding) can be passed through to beneficiaries.  Ordinary excess tax withholding would have to be refunded to the estate for subsequent distribution from the estate to the beneficiaries.