The sale of home is being reported on the 1041 Estate tax return. After applying the step up basis there is a 344K gain which will show on the surviving spouse’s K1. Both spouses lived in the house and would qualify for the primary residence exclusion. The house was sold less than 2 years after the date of death, so the surviving spouse also qualifies for the entire 500K exclusion.

I’ve played with the SOH worksheet on the 1040 but can’t seem to link it to the K1 capital gain on the individual tax return.

How should this be reported? Does it get indicated on the 1041 K1 or how would I best manipulate the 1040?