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Level 3

Form 1041 Schedule B

I am currently working on form 1041 for my mom's estate. The only asset in the estate was her home. The step-up value was determined to be $287,800 at her time of death. We sold the property for $316,500.00. After deductions, the total net gain from schedule D was $4940.76. Total income on line 9 was $5281.91 (The capital gains from the home sale plus a state tax refund). Line 14 is a deduction of $4143.50 for payment to the probate attorney. On Schedule B I have a question. Line 9 says "Income required to be distributed currently". Would that be the amount of money in the estate bank account ($72807.51) (Our proceeds from the sale of the home $76609.86 plus the $341.15 tax refund, minus the $4143.50 payment to the attorney).  If so, should the proceeds from the sale of her home been listed as "other income" in the income section of the form?

2 Replies
Level 15

Form 1041 Schedule B

Line 9 says "Income required to be distributed currently"


Remember you are filing an estate INCOME tax return so that line is ONLY referring to the INCOME on the return   ... the rest of the sale is the corpus and will also be distributed as required but not reported on the 1041.


Level 3

Form 1041 Schedule B

Okay. So, I don't report the money in the estate account, to be distributed to the heirs, on form 1041? That is a bit confusing. On line 18, pg. 1 it says to put the amount from schedule B, line 15 and attach the schedule K's. The schedule K's will be for the money distributed to heirs from the estate account, so the amounts won't match. What do the schedule K's have to do with the amount I enter on line 18 on page 1 if I don't have to enter the proceeds from the home sale anywhere on the 1041?

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