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Allocation of Capital Gains from an Estate

Forum|Forum|6 years ago
February 24, 2020
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My father passed away in July, leaving a single brokerage account worth $600000. There are 4 beneficiaries in his will; 40%, 30%, 20%, and 10%. The brokerage account was converted to cash in October, resulting in $20 in interest, $500 in dividends, and $9000 in capital gains. TurboTax converted all the capital gains to long-term.

In late October, we distributed all but $20000 of the cash to the beneficiaries. When all expenses and taxes are known, we will file a final 1041, but this one is not a final one.

How do I fill in the "Allocation of Capital Gains?"

Best answer by Anonymous_

@tmkratzke wrote:
So is "the amount allocated in Allocation of Capital Gains (Loss)" the entire amount?

Yes, the entire amount you are distributing.

A

Anonymous_

Employee

@tmkratzke wrote:
How do I fill in the "Allocation of Capital Gains?"

If you are allowed to distribute capital gains to beneficiaries, then you enter the amount allocated in Allocation of Capital Gains (Loss) and also, in that section, allocate the gains to income.

When you make a distribution, the gains so allocated will be available for distribution to the beneficiaries.