Entering Deductions in Form 1041 K-1

Forum|Forum|3 years ago
April 10, 2023
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I received a beneficiary's form 1041-K1. It has deductions in fields 1, 2a,2b, and 3. TurboTax does not allow negative numbers. How do I claim those deductions?

Best answer by Anonymous_

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Anonymous_Answer

Employee

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mpheedAuthor

The form does not have negative numbers. The numbers are deductions as noted on the form (as the K-1 allows "income, deductions, credits, and other income"). However when you try entering those numbers in TurboTax K-1 form, it considers anything entered there as income. There is no option to claim deductions. Possible solution could have been allowing negative numbers in TurboTax form or a check box that cclaims them to be deductions. Question was how do I claim these deductions in TurboTax using its Form.

Anonymous_

Employee

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mpheedAuthor

Thanks for responding. Let me clarify.

I am a beneficiary of a terminated estate. The estate has sent me 1041 K-1. The estate had expenses and loss carryover, and as a final return of a terminating estate, those expanses and carryover are shown as deductions on my form 1041 K-1. The IRS states that this form to be used to report to the beneficiary any deductions and credits, not just income. So the form I received shows deductions, on IRS Form 1041 K-1, boxes 1, 2A, and 2B. None of them are income and none of them are negative numbers. It is just that they are deductions that rightfully belong to me and that negatively affect my taxable income. However, when I try to enter in the TurboTax page these amounts in their respective boxes (1, 2A, 2B) the amounts I enter are treated as income, not deductions. So they increase my taxable income instead of reducing it. So somehow I need to show these amounts, reported to me by the estate, as deductions that reduce in my taxable income. So the question is how do I claim these deductions, since TurboTax does not accept deductions (loss of income) in their entry forms..

I hope it makes sense. Thanks.