The terms of the trust and providing the trust document to the IRA custodian will determine whether the trust is qualified for look-through for determining required minimum distributions. The terms of the trust will also determine how income is to be distributed to be distributed to beneficiaries. How long the IRA can remain depends on the RMD requirements.
If the entire IRA has already been distributed to the trust, passing the income through to beneficiaries as distributable net income will allow the income to be taxed at the individual's tax rates rather than the generally higher trust tax rates. Once received by the trust, the income must be taxable on the trust's income tax return for that trust year unless passed through to trust beneficiaries for taxation on the individual's tax return for the year that contains the end date of that particular trust income tax year.
