fees charged by title company to pay recipient of loan payments from a borrower

[Taxed_out]

We are filling out form 1041.  The decedent loaned money to a family in order for them to pay off their home loan.  Monthly payments are made by the family to the title company and a monthly fee is charged by the title company to release the payments to the trust.  Are the monthly fees deductible from the interest being reported on 1041?

[DianeW777]

The monthly fees are a deduction on the estate because it is a cost of obtaining interest income. List this as 'Other deductions'. However, they should not be used as an adjustment to the interest income. The IRS will look for the full amount of the interest on the tax return.

[Taxed_out]

Thank you!  Makes sense.