Here are the details associated with my K-1 question. I received a response asking for more information but my reply was rejected .
Re: I received an inheritance that is not taxable but was reported to the IRS via K-1. How do I make sure it not taxed as income in 2023? (Community response)
Thank you for your response. I did not see your response until you mentioned it in your email. How do I know if someone has responded?
1. I got a K-1 last year, but it was for an inherited IRA, which is taxable, but not until it was cashed out. I did pay the tax when I cashed it out. I did not receive the K-1 it until 3/24. I had already filed my 2023 Tax return. The money was earned in 2023, but nothing was paid out until 2024.
- Box E is checked. It says this is the final Form 1041 for the estate or trust. L
- Line 1 -Interest $17
- Line 2-Dividends $12,510.
- Line 14- Other information, has an E in it, which indicates net investment income $12,127 or the total of lines 1 and 2a. So, this is reporting the Investment income twice. The letter along with it said, this is the only K-1 you will receive.
2. The executor, my evil brother, is going to send another K-1 this year. Not sure why, since the last one said this is the only K-1 you will receive. Is he screwing with me? This one is for final distribution of my parents' family trust. This will be about $180,000.
- The distribution this year came from cash out of a Schwab Trust account. It is an inheritance that is not taxable. No Federal tax on inheritance, and Illinois exempts $4m.
I assume the same boxes and lines will be included. How do I file so that this inheritance is not taxed?
