Maybe I did not explain well.  On the K-1 of the 1041 estate the amount in on line 5 which is other portfolio and non business income.  This is an inheritance the letter attached said.  in box 14 one of the amounts listed their is the same amount as on line 5 but classified with an H which the instructions say is an adjustment for net investment income to the beneficiary  for section 1411 deduction. Enter on line 7 of form 8960.  Since is an inheritance should this not cancel each other out to be a non taxable event.  The letter that came with the K-1 said there should be no tax due to this amount.  I have not had but only one other of these and that one did cancel its-self out but this one does not.  So it is confusing to me that line 5 of the K-1 says investment income and then shows up as rental on the schedule one. As an inheritance it should not be taxable should it?