SIMPLE TRUST Fed K-1 vs MA state K-1

Forum|Forum|1 year ago
February 5, 2025
1 reply
13 views

Hello Everyone,

I have a question about a SIMPLE TRUST tax return (Form 1041) that has a commercial rental property (Schedule E), which as net rental income that is distributed to two beneficiaries via K-1.

QUESTION: I am assuming that the Federal K-1 net income amount should flow to the MA state 2K-1, is this correct?

I am reviewing this Trust return for a friend (she uses Drake), and I caught this error -- the MA state 2K-1 has no amounts, causing the MA Trust return to owe taxes. Based on my understanding of SIMPLE Trusts, the income is distributed to the beneficiaries, so the Trust does not pay tax at Fed and MA trust level, but the income passes through K-1 to the beneficiaries' personal income tax returns.

Does this sound correct?

Thank you!

SW

ProSeries Basic

This topic has been closed for replies.

Best answer by Taxprohere

Whichever software version you may be using, there should be a checkbox on the MA return that also needs to be checked to indicate all income being distributed. It's not checked by default nor takes it from the Federal.

TaxprohereAnswer

Level 7

Whichever software version you may be using, there should be a checkbox on the MA return that also needs to be checked to indicate all income being distributed. It's not checked by default nor takes it from the Federal.

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