1041-US: Allocating income distribution deduction on Schedules K-1 (FAQ)

Alerts and notices
Leave Feedback

Question

How does the income distribution deduction allocate among the particular income types on the Schedules K-1?

Answer

The Allocation of Expenses by Income Type - Tax Basis Worksheet shows the net income types available for distribution to beneficiaries.

  • If using equal allocation (on Screen Allocate in the Allocation folder) or Income Distribution amounts or percents (in the Beneficiary Information window > Federal tab), the beneficiary is allocated a proportionate share of all the non-gain net income categories available.
  • If using special allocations (in the Beneficiary Information window > Federal tab), the beneficiary is allocated only the categories indicated for allocation.

Related topic: 1041-US: Beneficiary distribution calculations FAQs