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163(j) & Trusts

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Level 1

One of my clients has 8 entities (S corps & partnerships) under common control (parents & their children) with combined gross income of over $25 million, so they are each filing Form 8990.  The family group also includes a trust that owns 3 commercial buildings, which are rented entirely to the main operating company.  Each building is reported separately on Schedule E.  I don't see Form 8990 in the Fiduciary Icnome Tax  mudule.  Are trusts that own a trade or business required to file Form 8990?  If required, can 3 rental properties be combined for computation?  Is an election for combination required?

Ironically, the trust is the only entity where interest would be limited.

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Employee
Employee

The 8990 is required to be filed with Form 1041 when business interest expense needs to be limited. The form is filed one per 1041, so all three rentals in the trust would be on one 8990. The Lacerte 1041 module does not currently support Form 8990 so it will need to be manually prepared and attached to the return with any adjustments manually entered.

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Highlighted
Employee
Employee

The 8990 is required to be filed with Form 1041 when business interest expense needs to be limited. The form is filed one per 1041, so all three rentals in the trust would be on one 8990. The Lacerte 1041 module does not currently support Form 8990 so it will need to be manually prepared and attached to the return with any adjustments manually entered.

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