M-MTax
Level 15
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Business & farm

You should not be paying income tax on the same income if the trust has paid the tax on that same income.

 

However, it is possible that the trust is distributing income to you (such as interest, dividends, et al) and issuing you a K-1 for that income (on which you pay income tax) AND also earning capital gains on which the trust is paying the tax (as capital gains typically remain with the trust).

 

Regardless, there should be no double taxation.

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