Trust Tax Return with multiple beneficiaries. - Spidell

Trust Tax Return with multiple beneficiaries.

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Message Board Trust Tax Return with multiple beneficiaries.

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    • #219774
      Timothy Lee
      Participant

      My client’s mom passed away in January 2019 and her house was sold for $750,000 in May 2019. The house was only asset mom owned and it was in the living trust. The Trust listed all of her 4 children as equal beneficiaries.
      The Trust also indicated that $160,000 to be distributed to her 7 grand children and 5 other family members at the death and the remainder was to distributed equally to her 4 children.
      Do I need to issue k-1 to everyone who received the money? or Should K-1 be prepared for 4 children only?
      The $160,000 was to come from the sale of the house.

      Thank you.

    • #219918
      Renee Rodda
      Participant

      Based on your description the $160,000 was a principal distribution, not an income distribution, so the K-1s would only be prepared for the 4 children.

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