The capital gain tax rates for trusts are the same as for individuals, but the income at which the trust tax rates change is much lower. For instance, trust income over $13,700 will be taxed at 20%, whereas a taxpayer filing as single will not pay the 20% capital gains rate until their income reaches over $459,750 in 2022. Income below $13,700 is taxed on estate income at a rate of 15%, whereas a single individual would pay a 15% rate on capital gain income up to $459,750.
Short-term trust capital gains are taxed at ordinary trust income tax rates which are typically much higher than individual federal income tax rates.
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