I am having difficulties getting credit on the 1041 for dividend income distributed to the sole beneficiary.

On the K-1 Beneficiary's Allocation Smart Worksheet A 1 and 2 are both set at 100% allocation to the beneficiary. If I enter the allocable share of dividends distributed to the client on the "Amounts to Allocate to Schedules K-1 Worksheet" they flow through to the K-1 however the 1041 does not show a corresponding reduction in income taxable to the trust.

Form 1041 line 2b shows the full amount of qualified dividends as allocable to the estate or trust rather than beneficiaries. The result is reporting the same dividends as taxable income to both the trust and the beneficiary. 

Would appreciate input to solve this, thank you.