Question

Trust Grantor Letter

Forum|Forum|1 year ago
March 11, 2025
1 reply
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I received a grantor letter for a wind down trust. The letter includes interest income, attorney/accountant fees, other general and administration expenses, and realized loss on marketable securities. Other posts suggest entering this information on 1041 as if I had received a K-1. When I do this, I can enter the interest in box 1 and the realized loss from marketable securities in box 5 (other portfolio and nonbusiness income), but where would I enter the attorney/accountant fees and the administrative expenses? Is this even the right way to enter this information? I would appreciate any help. thanks!

PatriciaV

Yes. You would enter the information reported on the Grantor Tax Advice Letter as if it were reported to you on a Form 1041 K-1.

If this is the final report from the trust, the fees and expenses would be reported in Box 11A. You would also mark the "K-1" as final. Otherwise, the fees and expenses are not deductible and should not be entered.

You may wish to contact the source of the grantor letter for clarification of these expenses and how they should be reported.

[edited 3/12/25 | 10:04 PDT]

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M

MrK3Author

Thanks! This is not the last grantor letter I will receive from this trust, but the fees/expenses were listed under the deductions heading on the letter, which is why I was confused on where to enter them. Thanks so much for the help!