With the Turbo Tax Business program, a trust with a credit for prior year state income tax is having that credit applied against the income that goes to the beneficiary, but it shouldn't. That is a credit to the trust, not to the beneficiary. It means that the income distribution deduction schedule comes out wrong, as does the K-1 for the beneficiary. The program is helpful, but costs a lot of money to then have to turn around and override things to make it come out correctly. IF the trust document requires current income to be distributed to the beneficiary, that's what the beneficiary gets, not that minus last year's state taxes. It will mean overriding and redoing the forms - and maybe not being able to file electronically as a result. And some people wouldn't know to do that and would rely on TT to have it correct. I hope someone from Turbo Tax will see this and correct it - if not this year, at least by next year. There ought at least to be a choice as to how to allocate the deduction. Pretty poor showing by Turbo Tax.
You'll need to sign in or create an account to connect with an expert.
Are you still experiencing this problem?
Make sure you have ran all updates.
If using TurboTax Online: Clear your cache and cookies. See this FAQ, for your particular browser.
If using TurboTax Desktop: Please see this FAQ.
Still have questions?
Make a postAsk questions and learn more about your taxes and finances.
Kazo
New Member
vaishali101
New Member
pbarber
Level 2
pbarber
Level 2
adrespond
Returning Member
Did the information on this page answer your question?
You have clicked a link to a site outside of the TurboTax Community. By clicking "Continue", you will leave the Community and be taken to that site instead.