The WKK1 screen can be used to allocate or adjust many of the items that flow to the beneficiaries' K1s. For anything to flow to the K-1, it has to have a value on the Wks Sch K-1 first, either through other data entry that flows there or by direct entry on the WKK1 screen.

The WKK1 screen performs pass-through adjustments like the K screen in a 1065 or 1120-S return (there is no Schedule K in a 1041). The WKK1 screen eliminates the need to modify each beneficiary's K-1 to make adjustments.

Income

For K-1 lines 1 - 8, override fields:

• To be allocated to the beneficiaries, income must appear in View/Print mode on the Wks Sch K-1. In other words, it must already be entered in the return as you cannot use screen WKK1 to enter new income.

• Lines 12c (short-term capital gain) and 12d (long-term capital gain). To appear on worksheet Wks Sch K-1, you must first allocate gain to the beneficiaries at the bottom of screen D2. Enter the beneficiary allocation in column (a) and calculate the return.

• With no entries on screen WKK1, the software calculates income allocation according to the formula shown at the top of Wks Sch K-1.

• To reallocate income to the beneficiaries, enter the amount of income to be allocated.

  • The amount you enter in lines 1 - 8 cannot be greater than the source income for that line on the 1041. The source income for each line is shown on column A of Wks Sch K-1.

  • If you choose to override any amount on lines 1-8, then you must override all lines 1-8. Enter zero, if needed.

  • The total of lines 1, 2a, 3, 4a, and 5 through 8, must equal Form 1041, line 18.

Directly Apportioned Deductions

For K-1 line 9, use this section of screen WKK1 to re-categorize depreciation as depletion or to adjust amortization.

Alternative Minimum Tax Adjustment

For K-1 line 12, enter the attributable AMT adjustments allocable to the beneficiaries based on the income distributions.

Credits and Credit Recapture

For K-1 line 13, use this section of WKK1 to allocate credits and credit recapture to the beneficiaries. Amounts allocated to the beneficiaries should not be included on the 1041.

Other information

For K-1 line 14, use the link to screen K14B, Beneficiary Foreign Tax Schedule, for allocation to beneficiaries of foreign tax paid. The K14B screen produces a statement in View/Print mode named STATMNT~.