M-MTax
Level 12

Retirement tax questions

So are those payments, which are not for the beneficiary's indiscriminate use taxable to them?

Yes, the distributions are taxable to the bene to the extent they come from taxable income such as interest, dividends, capital gains, and the like........unless the trust pays any tax due. The bene can of course deduct medical expenses on the bene's own income tax return.