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Fixed Assets and UltraTax CS 2023 help is now on Help and Support. We're still moving articles, but you can find most content for the 2023 tax year there. Continue using the Help & How-To Center for tax years 2022 and older.

Question

How does the application share and report grantor trust data?

Answer

Per the IRS Form 1041 instructions, a grantor trust may file Form 1041 or use an optional filing method that does not require filing Form 1041. The application only supports the filing Form 1041 method using a separate employer identification number (EIN) issued to the trust. Presumably, all trust activity is reported to the IRS with the trust's EIN, not the grantor' Social Security number. Therefore, to avoid IRS-matching problems, grantor trust data will be shared to Screen K1T, located in the K1 1041 folder. This will result in summarized reporting of the grantor trust data on the grantor's Form 1040.

If the fiduciary uses an optional filing method and items are reported under the grantor's Social Security number, do not share data from 1041 to 1040. To disable the data sharing feature for an open 1041 client, choose File > Client Properties, click the Advanced Properties button, and mark the Exempt this client from all Data Sharing functionality checkbox on the Restrict Access tab. In addition, data from these types of grantor trusts should not be entered in Screen K1T, located in the K1 1041 folder. Instead, enter the amounts from the Grantor Report on the applicable screens to report the items in detail on the grantor's tax return. For example, instead of entering interest in the Interest statement dialog in Screen K1T, enter interest in the Interest income field in Screen B&D, located in the Income folder.

Related topic: Grantor trust FAQ (1040)

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