Estate/Trust where do you input mortgage interest deduction from K-1, box 11(B) on beneficiary's 1040?

Forum|Forum|1 year ago
March 22, 2025
15 replies
115 views

Excess Deductions on Termination - Non-Miscellaneous Itemized Deductions for interest portion. Prior to 2018 they were claimed by beneficiary as a "2% Miscellaneous Itemized Deduction."

Lacerte Tax

sjrcpa

Level 15

What was mortgaged?

It might be Investment Interest expense.

It might be nondeductible.

The more I know the more I don’t know.

N

Niebo_26Author

Level 3

Thank you for your response. The CPA who prepared the Form 1041 and K-1 said the interest is for a reverse mortgage loan that was paid on a residence including property taxes.

sjrcpa

Level 15

Does the beneficiary live in that house?

Need more details about the house in the hands of the Trust.

Was it sold?

Did Trust inherit it form someone?

The more I know the more I don’t know.

J

joelkanis

Level 2

If it meets IRS requirements, mortgage interest reported in Box 11(B) for a beneficiary receiving a K-1 from an estate or trust is deductible investment interest. This is usually shown as mortgage interest on Schedule A of the beneficiary's Form 1040. If the interest deduction relates to investment property rather than a personal residence, make sure you follow the guidelines.

Check out this guide on reverse mortgage interest tax deductions for additional information on which mortgage-related fees and interest are deductible. It offers a concise summary that complies with IRS regulations regarding trusts and estates.

BobKamman

Level 15

Clicked on the link, which is 2021 quote from some random CPA, and immediately started getting spam emails from the company. I'm usually better at avoiding that.

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