tagteam
Level 15

Business & farm


@kranders wrote:

I am filing a 1041 for a simple trust. 


A beneficiary of a simple trust includes in gross income for the tax year the amount of income required to be distributed for that tax year, whether or not the income is distributed.

 

See Treas. Reg. §1.652(a)-1

 

Therefore, the basic answer to your question is "No, the beneficiaries will liable for any tax due on their distributions to the extent of distributable net income (DNI), which will be reflected on their K-1s".

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