Enter capital losses to allocate to a beneficiary (1041)

Complete these steps to allocate capital losses to a beneficiary.

  1. Click the Allocation folder on the Data Entry tab to open the Allocate screen.
  2. If this is not a final return, enter X in the Allocate capital losses to beneficiaries on non-final return field in the Beneficiary Allocation Options section. If this is a final return, the first two steps in this procedure aren't required.
  3. Click the Beneficiaries tab and enter beneficiary information if you haven't already. 
  4. Click Allocations on the left. 
  5. Highlight the first beneficiary who will receive an allocation and click Edit.
  6. Enter percentages in the Required Percent Short-term Capital gains and Required Percent Long-term Capital gains fields to allocate the capital losses.
  7. Click Save.

Notes

  • You can't use amounts to allocate capital losses.
  • Per IRS instructions, capital losses are reported as positive amounts on Schedule K-1, Box 11 and not as negative amounts in
    Box 3 or 4.

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