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final exemption trust tax return Expand / Collapse
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Anonymous
Posted 10/8/2008 5:19:40 PM




I am preparing a final year tax return of an exemption trust as the surviving spouse beneficiary has died. If the trust has an NOL and suspended passive losses, what happens to these? Do they go out to the remainder beneficiaries or are they just lost?
Thank you
Post #666
Posted 10/9/2008 10:56:34 AM
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On the final 1041, any unused NOL goes out to the beneficiaries on the Schedule K-1.

The passive losses have a different rule; they're not lost - they add to the basis of the property they're associated with. So if it's a rental, you may have something new to depreciate. If it's a partnership interest, you'll have additional outside basis. I usually put the information on a K-1 footnote.

Mary Kay Foss

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