How to report interest income adjustment on Final 1040 Sch B for the part of interest belongs to the decedent's estate?

Forum|Forum|3 years ago
May 16, 2023
1 reply
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Per 1041 instruction, when preparing a decedent's final 1040 income tax report tax return, report on all interest income from Form 1099INT issued with the SSN of the decedent on 1040 Schedule B, and then subtract the portion of interest belong to the decedent's estate from the subtotal of interest income. The adjustment portion should be shown as "Form 1041" and the name and address shown on Form 1041 the decedent's estate, and the part of interest income belongs to the estate as negative amount. However, in ProSeries Professional software, Schedule B additional information, Section E - Adjustment information, there is no place to enter the information regarding Form 1041 adjustment. When selecting type of adjustment as Nominee, the form shows " nominee distribution" only. I cannot enter any additional information regarding the Form 1041, name and address of the estate. Is there any other way to report the interest adjustment which belongs to 1041 estate income tax return?

ProSeries Professional

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Best answer by BobKamman

You mean reporting the total interest on Schedule B and then backing it out by selecting the adjustment code N as Nominee distribution is good enough? Is it necessary to issue a Form 1099INT to the estate for the portion of interest designated as Nominee distribution?

@VIC888 wrote:

You mean reporting the total interest on Schedule B and then backing it out by selecting the adjustment code N as Nominee distribution is good enough? YES Is it necessary to issue a Form 1099INT to the estate for the portion of interest designated as Nominee distribution? NO

BobKamman

Level 15

Where are you finding that requirement? I don't see it in the instructions to Schedule B, or in Pub 559.

V

VIC888Author

Level 3

1041 instruction, page 21, Line 1- interest income, there is detail instruction for how to report interest income on final 1040 schedule B.

BobKamman

Level 15

Ignore those. The people who write the 1041 instructions don't talk to the people who write the 1040 instructions. Remember, it's the government you're dealing with here. If you were splitting the income between the decedent and the surviving joint tenant, you wouldn't even be filing a 1041.

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