Drake Tax - 1041: Fees and Other Expenses Offset by Exempt Interest

Fiduciary fees amount displayed on line 12 of the return are less than the amount entered on screen 3

In a trust or decedent's estate with tax-exempt interest income, that interest may offset some expenses, such as fiduciary and other fees. See Part II of worksheet Wks TAXEX. The allocation is automatic, but can be overridden in the screen 3 (screen 5 in Drake18 and prior) fields below the heading Wks TAXEX - Worksheet for Tax-Exempt Income.

For example, when tax-exempt income is present and fiduciary fees are entered on line 12 of screen 3, what appears on line 12 of the 1041 return is the fiduciary fee balance after allocation of tax exempt income.

Tax-exempt interest income may come from screens INT, DIV, or any of the K1 screens.