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Common questions on Fiduciary passthrough K-1 credits in ProConnect Tax

by Intuit•1• Updated 1 year ago

Get answers to frequently asked questions about 1041 passthrough credits.

Where do I enter backup withholding?

To enter Backup Withholding from a 1099-INT:

  1. Go to Input Return ⮕ Income ⮕ Interest Income.
  2. Enter applicable income amounts.
  3. Locate the Tax Withheld subsection.
  4. Enter the tax withheld in, Federal income tax withheld.

To enter Backup Withholding from a 1099-DIV:

  1. Go to Input Return ⮕ Income ⮕ Dividend Income.
  2. Enter applicable income amounts.
  3. Locate the Tax Withheld subsection.
  4. Enter the tax withheld in, Federal income tax withheld.

To enter Backup Withholding from a Fiduciary K-1:

  1. Go to Input Return ⮕ Income ⮕ Passthrough K-1's 
  2. Select the Lines 12-20 tab.
  3. Scroll down to the Credits (15) section.
  4. Enter the amount in, Estimated taxes credited from Trust (1041)(13)(A).

To enter Backup withholding from entities other than trust:

  1. Go to Input Return ⮕ Credits ⮕ Other Credits and Withholding ⮕ Other Credits and Withholding
  2. Enter the amount in, Backup withholding form 1099 [A].

ProConnect Tax will automatically enter the backup withholding on the 1041 Line 24e. To pass the credit to the beneficiary per return:

  1. Go to Input Return ⮕ Beneficiary/Grantor Info. ⮕ Schedule K-1 Distribution Options.
  2. Enter a 2 in, Credits: 1= in fiduciary, 2= prorate to beneficiary [O].

In a Final year return, the Back Up Withholding will flow to the Schedule K-1, line 13 code B.

To enter the Passthrough K-1 Foreign tax credit information:

  1. Go to Input Return ⮕ Credits ⮕ Foreign Tax Credit (1116).
  2. Select the Name of foreign country from the dropdown menu.
  3. Select the Category of income (Click on arrow to select from list)
     from the dropdown menu.
  4. Locate the Gross Income, Deductions, and Losses section.
  5. Select Gross income within country (Click on button to expand).
  6. Enter K-1 under the Description column.
  7. Enter the Amount.
  8. Select OK.
  9. Scroll down to the Foreign Taxes Paid or Accrued section.
  10. Enter the Date paid or accrued
  11. Locate the U.S. Dollars subsection.
  12. Enter the amount of foreign taxes paid in Other foreign taxes.
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