Enter other allocations for beneficiaries (1041)

Complete these steps to allocate all other types of allocations, like the ones listed in the table below, using a single set of percentages.

  1. Click the Beneficiaries tab in a 1041 project and enter beneficiary information if you haven't already.
  2. Click Other Allocations on the left.
  3. Highlight a beneficiary and click Edit.
  4. Enter percentages in the Edit: Other Allocations panel.
  5. Click Save.

The following table provides information about specific fields in the Edit: Other Allocations panel.

Field Entry Notes
Depreciation/Amortization Enter a percentage to directly allocate depreciation and amortization to the beneficiary. Onvio Tax calculates these amounts and then reports them on the beneficiary's Schedule K-1, box 9, instead of on Schedules C, E, and F and Form 4562.
Depletion Enter a percentage to directly allocate depletion to the beneficiary. Onvio Tax allocates the depletion to the beneficiary on Schedule K-1, box 9, instead of on Schedules C and E.
Credits/Estate tax/Foreign Tax Credit Enter percentages in these fields to allocate any current-year business credits, foreign credits, and estate tax deductions to the beneficiary.

If you leave these fields blank and do not mark the First tier beneficiaries: Allocate all items, except capital gains, equally field on the Allocate screen, the following happens.

  • For non-final returns of estates and complex trusts, Onvio Tax allocates 100 percent to the fiduciary.
  • For final returns and simple trusts, the follow allocations occur.
    • Onvio Tax allocates 100 percent of the current-year credit to the beneficiaries.
    • If you do not want 100 percent of the current–year credit allocated to the beneficiaries, mark the Final return or simple trust: Allocate credits, estate taxes, or state withholding between trust and beneficiaries field on the the Allocate screen and enter percentages in the fields on the grid for each beneficiary. To allocate 100 percent to the fiduciary, leave the percent fields blank.
  • For grantor trusts and agency relationships, Onvio Tax always allocates 100 percent of the credit to the beneficiaries.
Withheld Income Taxes/Backup Withholding Enter percentages in these fields to allocate income taxes/backup witholding to the beneficiary.

Onvio Tax allocates the information you enter in the Section 3406 backup withholding allocated to beneficiaries field on the Allocate screen in the Allocation folder on the Data Entry tab up to the amount of witholding you enter in the following locations.

  • Statement for the Interest income, Dividends, or Other income field on the Income screen in the Income folder on the Data Entry tab
  • Statement for the Other withholding field on the PayExt screen in the Payments folder on the Data Entry tab
  • Federal tax withheld field on the 1099M, 1099R, W2, and W2G screens in the Income folder on the Data Entry tab
  • Federal income tax withheld field on the K1-3 screen in the K1 1065, 1120S folder on the Data Entry tab

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