Where does one enter 1099-R for MRD from inherited IRA in TT Business?
I am trustee for a Special Needs Trust working on the 2024 return using TT Business package.
Error checked said the way I entered this data last year (which was deemed correct) is incorrect this year.
Why is there not a clean way to enter this data. This "Business" package is supposed to work for Trusts but has so many glitches.
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There is no special interview for the 1099-R on business returns. This is because 1099-Rs are treated much differently (i.e. more simply) on business returns than on the 1040. Just enter the 1099-R distribution as Other Income.
As champ dmertz puts it:
Retirement account distributions paid to a trust do not have the complexity of those paid to individuals because these distributions paid to a trust are never subject to an early-distribution penalty, never eligible for rollover, can never be a Qualified Charitable Distribution, an HSA Funding Distribution, be used to pay for health insurance of a Public Safety Office or have any of the other complexities of distributions made to individuals, so there is no need for any special section in TurboTax Business for the entry of Forms 1099-R. The taxable amount is simply entered as Other Income, essentially one-line entry.
The Instructions for Form 1041, which should be your reference for preparing any trust income tax return, clearly state that these distributions are to be reported as Other Income. The instructions for Form 1041 also indicate where on Schedules K-1 this Distributable Net Income is to be reported.
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