how to enter negative number on Schedule B Part II

[JHub]

I've been issued a 1099 from a company for an account that needs to be associated with a trust's return and not mine.  I was told by a CPA to fix the problem I need to include language on Schedule B Part II where the first line states the payer and the amount paid and the second line states "Less reported through trust (EIN ##-#######)" and the amount is the negative of the amount paid.  In effect, zeroing out the amount paid.

Unfortunately Turbotax doesn't allow you to enter a negative amount on Schedule B Part II.  Is there a way to allow an negative amount to be added?

[KrisD15 · Accepted solution]

Yes, you can make an adjustment using TurboTax.

You may need to delete that first entry and start over. 

Here are the steps to make that nominee adjustment

Wages & Income

Investment Income

Stocks, Cryptocurrency, Mutual Funds, Bonds, Other START 

Select "Stocks, Bonds, Mutual Funds"

Continue

Skip Import

Complete the "Which bank or brokerage is on your 1099-B?" screen and continue

Click through the questions if necessary to get to the screen-

NOW CHOOSE HOW TO ENTER YOUR SALES

Be sure to select "Sales section totals" and Continue

On the "Now, enter one sales total on this 1099-B"  screen -

Enter the Sales section (type of Capital Gain), Proceeds and Cost 

CHECK THE BOX FOR "I need to adjust my total cost basis" 

A drop-down list appears with adjustment codes

Scroll down and Select N (nominee for actual owner of property) 

Enter the amount of the gain as a negative number or the amount of the loss as a positive number

Since the Broker sent you the 1099-B, you should have issued a 1099-B to the trust. 

According to the IRS

"Generally, if you receive a Form 1099 for amounts that actually belong to another person, you are considered a nominee recipient. You must file a Form 1099 with the IRS (the same type of Form 1099 you received) for each of the other owners showing the amounts allocable to each. You must also furnish a Form 1099 to each of the other owners. File the new Form 1099 with Form 1096 with the IRS Submission Processing Center for your area. On each new Form 1099, list yourself as the “payer” and the other owner as the “recipient.” On Form 1096, list yourself as the “Filer.” A spouse is not required to file a nominee return to show amounts owned by the other spouse. The nominee, not the original payer, is responsible for filing the subsequent Forms 1099 to show the amount allocable to each owner."

You will need to mail a copy of the 1099-B with Form 8453 with or without your return (the 1040 return may be e-filed).

Here are instruction on mailing Form 8453 with your 1099-B

[JHub]

Thank you for that information.  I actually received a 1099-DIV not a 1099-B.  In the meantime I talked to a Turbo Tax rep and she had me go to Interest and Dividends / Dividends on 1099-DIV and manually add the account with the information from the 1099.  I added the EIN of the trust to the name of the account.  Then when it asked if there were any uncommon situations that apply I selected "I need to adjust these dividends".  The next screen then asks for the adjustment amount where I put the full amount of dividends listed on the 1099 and I selected "I received all or part of these dividends for someone else (I am a nominee)".  That produced the right result on the tax return.

And thank you for letting me know about needing to submit a 1099 to the trust and IRS.