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Author: vkg Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 120809  
Subject: 1099 Box 9/Nominee Interest Date: 3/18/2012 8:05 PM
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Box 9 of a Consolidated 1099 contains $1,100. Half should be allocated to my father's income tax return and half to the estate income tax return.

The H&R block software handles Nominee interest, but doesn't ask about transferring value in box 9. I would like to have the entry correct, even though it doesn't really matter because there is no income tax or AMT liability for the personal return.

The safest seems to be to enter $1,100 and show the $550 on the estate tax return.

A tax return is required to be filed and estimated taxes for 2011 were made.
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Author: vkg Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 115552 of 120809
Subject: Re: 1099 Box 9/Nominee Interest Date: 3/18/2012 10:59 PM
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I believe I understand. Since there is no AMT calculation, the amount entered in the interview doesn't matter.

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Author: irasmilo Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 115553 of 120809
Subject: Re: 1099 Box 9/Nominee Interest Date: 3/19/2012 1:24 AM
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I believe I understand. Since there is no AMT calculation, the amount entered in the interview doesn't matter.

While that may be true for your return, that isn't the answer. The correct way to enter the nominee adjustment for the private activity bond interest is to enter it directly on Form 6251. You either modify the entry on line 12 or enter the adjustment on line 27.

Ira

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Author: vkg Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 115554 of 120809
Subject: Re: 1099 Box 9/Nominee Interest Date: 3/19/2012 2:08 AM
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Ira,

Thank you, I looked at Form 6251. It is nice to know where the information is used. Since the income is far below the exemption amount, Form 6251 isn't be filed. It looks like the personal return is complete, but will let it age a couple of days and review before filing.

The software is doing strange things when generating K-1s for the estate tax return. I am giving up for tonight and hopefully tomorrow it will be clearer on how the software wants the data entered.

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Author: irasmilo Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 115556 of 120809
Subject: Re: 1099 Box 9/Nominee Interest Date: 3/19/2012 7:16 AM
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The software is doing strange things when generating K-1s for the estate tax return. I am giving up for tonight and hopefully tomorrow it will be clearer on how the software wants the data entered.

There are some differences between the way reportable income is calculated on a partnership K-1 and an estate/trust K-1. If you can describe what you're seeing vs. what you think you should be seeing, we may be able to help.

Ira

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Author: vkg Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 115557 of 120809
Subject: Re: 1099 Box 9/Nominee Interest Date: 3/19/2012 12:15 PM
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The estate has taxable and tax-exempt interest. Since I have been having problems, I started a new return and only entered the taxable interest.

I am attempting to distribute the interest income on 2 K-1s.

The interview form for the K-1 asks for Tier 1 and Tier 2 distributions and percentage for beneficiary.

Entering 0 results in no distributions.

Entering a value in either Tier 1 or Tier 2, results in distribution on the K-1s. Schedule B doesn't look correct. Entering either Tier 1 or 2 distributions results inLine 10 Other amount paid, credited or otherwise required to be distributed being greater than the income for the estate. The amount appears to be the income plus the amount distributed on the K-1s.

Line 15 Income distribution deduction is correct.

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Author: ptheland Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 115558 of 120809
Subject: Re: 1099 Box 9/Nominee Interest Date: 3/19/2012 2:56 PM
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The estate has taxable and tax-exempt interest.

Don't forget that this means you need to allocate tax deductible expenses between the taxable and tax-exempt income.

--Peter

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Author: vkg Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 115559 of 120809
Subject: Re: 1099 Box 9/Nominee Interest Date: 3/19/2012 5:35 PM
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Don't forget that this means you need to allocate tax deductible expenses between the taxable and tax-exempt income.

--Peter


There really aren't any. There are no trading or management expenses. Since it was an estate, the banks waived early termination penalties on the CDs. The estate hasn't paid any taxes and none were withheld. The interview did ask about a number of expenses. The only one that might have applied would be the cost of the H&R Block At Home software, but it was bought in 2012. As a miscellaneous item would not have resulted in a deduction anyway. I plan on ignoring it.

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Author: vkg Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 115563 of 120809
Subject: Re: 1099 Box 9/Nominee Interest Date: 3/19/2012 11:33 PM
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Success. I deleted everything I did yesterday and very early this morning. I gave up on trying to have it calcuate the distributions. Entering a fixed amount to be distributed to each K-1 worked.

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