2023 Complex Trust-Estimated Tax payments not allocating to beneficiary

[KFCPA]

Preparing 2023 1041 for complex trust (not final year) with $11k Federal and $4k state K-1 pass through of 2022 estimated taxes from grandparent's 645 estate/trust. In addition, this complex trust made 4th qtr. 2023 estimated payments of $12k Federal and $6k to state.  Want to allocate all estimated payments to the beneficiary. Despite entering $12k/$6k applied to beneficiary, and filling out 1041-T for Code 2 $23k and 541-T for $10k in software, the 2023 payments aren't allocating out to beneficiary on 1041 and 541 return.  However, both form 1041-T and K-1 shows $12k; while form 541-T and K-1 shows $6k.  I realize I can use the K-1 override feature to get the amounts correct on K-1, but the 1041 is applying $11k refund and 541 doesn't even pick up the $6k and shows $4k refund. Tech support wasn't able to help. Any suggestions would be appreciated.

[IRonMaN · Accepted solution]

The problem relates to the fact that technically you aren't supposed to be able to transfer the estimates to the beneficiaries.

[KFCPA]

Hmm, thanks IronMan. However, IRC code 643(g) "A trust or, for its final tax year, a decedent’s estate may elect under section 643(g) to have any part of its estimated tax payments (but not
income tax withheld) treated as made by a beneficiary or beneficiaries."   Might have to be content with allocating only the Spend Thrift trust payments to it's beneficiary. 

Thank you for your help!