Trust Income

[S T]

I have a trust that I am closing for 2012-2013 fiscal year 645 election.

Assets are sale of the deceased's personal residence - no issue there.
Other Income to Trust was 3 months of income - from rents - Can I just show the Gross Rents received as income and not go through setting up a Rental with depreciation, etc.

It was temporary until the Trustee could make arrangements to sell the property which occurred in less than 6 months

Thoughts?

I just need a simple solution - there is no tax due that I can discern for the Trust - is and open/close out the TIN on the Trust.

Thanks,

Sandy

[Burke]

Is this an RLT in conjunction with an estate 1041 return? Rents were from personal residence? Or other property titled to trust? If it was a temporary rental of the personal residence pending sale, then no rental schedule necessary. Reporting gross rents would be okay.

[S T]

RLT (1041)- was going to use the 645 election for the RLT - as transactions are completed and not having to file 2012 and 2013 forms - only about $ 250K in Assets (Personal Residence of decenednt transferred to Trust and Small Bank Account) All other assets such as life insurance, retirement Accts passed through with a beneficiary designation - and still under the Estate limit - It is a RLT - and 3 month temporary rent was from the personal residence of the decedent while held in Trust in the RLT

On the personal residence transferred to Trust, There is some mortage interest, upkeep (utilities, gardenener, etc) and small amount of property tax on this Personal Residence - prior to Sale

Deductible or add to cost basis or none at all - Property not held for Investment as in Rental - other than what mentionned above for 3 months temporary


Thanks,

Sandy

[S T]

Any thoughts on how to treat the mortgage interest/property taxes, and maintenance/utilities?

Thanks

Sandy

[Burke]

Those are maintenance expenses of an asset held for sale, and all are deductible not subject to 2%. I usually take int and taxes on those lines provided, and the others on the misc exp line. Don't forget pro-rated property taxes shown on the HUD-1. May be a debit or credit depending on date of sale.