The trust beneficiaries will pay the tax on any trust distributions. To the extent trust income is not distributed, the trust will pay the tax on such income. Income that is distributed to the beneficiaries keeps the same character as it had in the trust. For example, if the trust had a short-term capital gain, and distributes that gain, the beneficiaries have a short-term capital gain.
No, you cannot file immediately. The IRS provides the following regarding Form 1041.
- For calendar year estates and trusts, file Form 1041 and Schedule(s) K-1 on or before April 15 of the following year.
- For fiscal year estates and trusts, file Form 1041 by the 15th day of the 4th month following the close of the tax year.
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