topic 1041 - How can Capital Gain Losses Flow to the K-1 for a final estate return? The CGL included on K-1 Distribution Form, but is negated on line 11 reclass excess deduct. in Business & farm

1041 - How can Capital Gain Losses Flow to the K-1 for a final estate return? The CGL included on K-1 Distribution Form, but is negated on line 11 reclass excess deduct.

rchesnps — Wed, 11 Feb 2026 04:23:00 GMT

I had prior year capital loss carryovers that should be distributed to the K1s.

Re: 1041 - How can Capital Gain Losses Flow to the K-1 for a final estate return? The CGL included on K-1 Distribution Form, but is negated on line 11 reclass excess deduct.

Anonymous_ — Tue, 06 Feb 2024 01:10:02 GMT

What do you mean by "...is negated on line 11 reclass excess deduct..."?

Short-term capital losses carryovers are reported on Line 11 with a C code while long-term capital loss carryovers are reported on the same line with a D code.

Are the losses not flowing through to your K-1s at all?

Re: 1041 - How can Capital Gain Losses Flow to the K-1 for a final estate return? The CGL included on K-1 Distribution Form, but is negated on line 11 reclass excess deduct.

rchesnps — Thu, 08 Feb 2024 01:55:07 GMT

The losses are reported correctly on Sch D. Issue comes with distribution of losses to K-1. Final TR, beneficiaries should receive losses on K-1. TT worksheet, Dist Income for Sch K-1, Pt II, Line 10 totals the losses, line 11, reclassify excess deductions reduces the capital gain distributions to $-0-.

Re: 1041 - How can Capital Gain Losses Flow to the K-1 for a final estate return? The CGL included on K-1 Distribution Form, but is negated on line 11 reclass excess deduct.

rchesnps — Thu, 08 Feb 2024 02:04:20 GMT

I just figured it out. The losses are then netted against the interest income and dividend income on line 12. Thanks for your response. Made me look at this in more detail.