Get answers to frequently asked questions about 1041 passthrough credits.
Entering Backup Withholding for a 1041 Fiduciary Return
Solution #1- To enter Backup Withholding from a 1099-INT:
- Go to Screen 15, Interest Income
- Enter applicable income amounts.
- Scroll down to the Form 1099-INT section.
- Locate the Tax Withheld subsection.
- Enter the tax withheld in, Federal income tax withheld.
Solution #2- To enter Backup Withholding from a 1099-DIV:
- Go to Screen 16, Dividend Income.
- Enter applicable income amounts.
- Locate the Tax Withheld subsection.
- Enter the tax withheld in, Federal income tax withheld.
Solution #3- To enter Backup Withholding from a Fiduciary K-1:
- Go to Screen 25, Passthrough K-1's.
- Scroll down to the Credits (15) section.
- Enter the amount in, Estimated taxes credited from Trust (1041)(13)(A).
Solution #4- To enter Backup withholding from entities other than trust:
- Go to Screen 38, Other Credits and Withholding.
- Click on Other Credits & Withholding from the top left navigation panel. (This will take you to Screen 38.2.)
- Enter the amount in, Backup withholding form 1099 [A].
Lacerte will automatically enter the backup withholding on the 1041 Line 24e. To pass the credit to the beneficiary per return:
- Go to Screen 9, Schedule K-1 Distribution Options.
- Enter a '2' in, Credits: 1= in fiduciary, 2= prorate to beneficiary [O].
Note: In a Final year return, the Back Up Withholding will flow to the Schedule K-1, line 13 code B.
Entering Foreign Tax Credit from a Passthrough K-1 into a Fiduciary Return
To enter the Passthrough K-1 Foreign tax credit information:
- Go to Screen 36, Foreign Tax Credit (1116).
- Select the Name of foreign country from the drop down menu.
- Select the Category of income (Ctrl+T) from the drop down menu.
- Locate the Gross Income, Deductions, and Losses section.
- Hold down Ctrl+E in, Gross income within country (Ctrl+E).
- Enter K-1 under the Description column.
- Enter the Amount.
- Click OK.
- Scroll down to the Foreign Taxes Paid or Accrued section.
- Enter the Date paid or accrued
- Locate the U.S. Dollars subsection.
- Enter the amount of foreign taxes paid in, Other foreign taxes.
Note: Schedule K-1 Page 2 includes instructions with more information detailing the reported items. Partnership, S-Corporate, and Fiduciary instructions will differ.