turbotax business - grantor trust income statement

[bob942]

Turbotax Business Grantor Trust, how do i list ordinary and qualified dividends on the Grantor Information Statement without adding the two together? Do I have to list the separately or can i just list the ordinary amount and label as Total dividends?

[tagteam]

You should list ordinary dividends and qualified dividends separately on the GIS so they can be entered separately on an individual income tax return.

[bob942]

If  I list OD and the QD separately then they are added together and the total of the list is wrong and does match the amounts on the 1040 Form for personal tax. Does that make a difference when transferred to the 1040 Form?

[bob942]

If  I list OD and the QD separately then they are added together and the total of the list is wrong and does {NOT} match the amounts on the 1040 Form for personal tax. Does that make a difference when transferred to the 1040 Form?

[tagteam]

@bob942 

You can correct that in Forms Mode by entering the qualified dividends either in parentheses or in the Other Information section (see screenshot).

[USER987456]

Thank you for that screenshot!

Do we include trust expenses on the grantor information sheet as well, IE accountant fees, attorney fees and trustee fees etc?

[tagteam]

Yes, you include deductible expenses on the GIS.

[USER987456]

And deductions from the GIS would go on schedule A of the grantor return correct?

[tagteam]

Generally, yes.

[USER987456]

Can't seem to locate proper place to report trust deductions (fiduciary fees, trustee fees  etc)  on the grantors tax return?

[tagteam]

You need the check the box.

[USER987456]

Yes, I see where to list the deductions on the 1041 and have them listed on Grantor Information Sheet...

Now that they are on the Grantor Information Sheet, where do we enter the deductions on the Grantor's 1040 tax return?

Thank you,

[tagteam]

Which deductions?

Simply put, if the deductions are those that a hypothetical individual (i.e., a person holding the same property with the same expenses) would incur, then they are not deductible on a 1040.

Another way to put this would be that any expenses that are unique to holding property in the trust are deductible (those expenses would be ones that an individual would not incur, such as preparing a 1041 for the trust).

[USER987456]

So financial advisor fees, trustee fees, attorney fees are not deductible for the trust/grantor?

[tagteam]

It depends upon the exact nature of the services provided to the trust.

However, trustee fees would not be incurred by an individual in the absence of a trust (i.e., they are exclusive to trusts) so that expense would be deductible.

Advisory fees and attorney fees might be deductible, in whole or in part, depending upon whether the charges were made as a result of the property being held in trust. If an individual would have incurred those expenses, they would not be deductible. 

Note that some of these expenses might not be deductible on a personal income tax return (1040) as a result of tax reform (the TCJA) which essentially eliminated miscellaneous itemized deductions.