artp Posted April 4 Report Share Posted April 4 Complex trust document allows trustee the discretion to pay corpus (principal) out of the trust for the sole beneficiary if he deems it necessary to meet her support and maintenance. If there are capital gains from the sale of investment assets in the trust can the trustee decide to pay out only a portion of those gains to the beneficiary and have part of the gains remained and taxed in the trust if she only needs a portion of the gains to meet her support and maintenance or is it an all or nothing situation? Quote Link to comment Share on other sites More sharing options...
DANRVAN Posted April 5 Report Share Posted April 5 16 hours ago, artp said: portion of those gains to the beneficiary and have part of the gains remained and taxed in the trust Why would you want to leave the capital gains in the trust? Normally there is less tax if the capital gains are taxed to the beneficiary instead of paying capital gains rates at the trust level. If the trustee is allowed to include the capital gains in DNI, then trust will take a related income distribution deduction and basically pay tax on the remaining amount. Quote Link to comment Share on other sites More sharing options...
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