Trust 1041

[lshuling]

Trust final year distributes all investment income to beneficiaries. $330,000 portfolio, and $9500 capital gain. Why is software putting an amount in the K-1s line 14 E and H. Why should there be a deduction from investment income for these individuals? I can not find instructions anywhere on how to calculate Box H when all income is distributed by Trust.

[snowshine]

line 14 entries

The line 14 entries make sense: Code E lists net investment income to help determine the deduction limits for investment expenses and/or interest. Code H is to help determine the net investment tax.

[lshuling]

The line 14 entries make sense: Code E lists net investment income to help determine the deduction limits for investment expenses and/or interest. Code H is to help determine the net investment tax.

Do you know how 14 H is calculated? I can not find this information anywhere for a trust that distributes all of its income. I only find a calculation for undistributed income. Where does this number come from? I want to be able to check the software.

[taxea]

What are you using as a resource for your research?

[lshuling]

irs publications, 1041 instructions, 8960 instructions, K-1 instructions, the web. Not much out there, but I received some input from a fellow CPA who informed me that you use a shadow of the Trust's 8960 as if they did not distribute income. Can not find a reference for that, but it makes sense.