Form 1041 - Distribution of Income/Loss to Schedule K-1

Simple Trust: The beneficiary of a simple trust must include in his or her gross income the amount of the income required to be distributed currently (as entered on Schedule B of Form 1041), whether or not distributed.  If the income required to be distributed currently to all beneficiaries exceeds the Distributable Net Income (DNI), the beneficiary's proportionate share of the DNI will be reported as income on Schedule K-1.

Estates and Complex Trusts: The beneficiary of a decedent's estate or complex trust must include in his or her gross income the sum of:

NOTE: Negative amounts for any class of income shown in boxes 1 through 8 of Schedule K-1 cannot be distributed until the final year of the estate or trust.

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Additional Resources
Instructions for Form 1041