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Exceptions That Allow Capital Gains to Be Distributed
Reg. 1.643(a) – 3(b) has specific requirements that must be met to allocate capital gains to the beneficiaries.

Prerequisites that must be met
1) Trust agreement and local law; or
2) A reasonable and impartial exercise of discretion by the trustee

 

 

so if state law allows the distribution of capital gains in the year of termination you can

of course, there's item 2) which seems to allow the fiduciary total discretion