My understanding is that it is a Simple Trust, because I am supposed to take the income every year. I also can take principal/corpus if I need to, but I think that is still a simple trust.
The income from the Trust every year is supposed to be allocated to me. I paid the taxes on it, but did not take the income out, leaving it in the trust to grow. I don't know if that remains income because I am entitled to it, or somehow goes back to being principal of the Trust. However, I am able to take principal/corpus out if I need to. I have researched everywhere and cannot find anywhere except in foreign countries, anything that really addresses taking income in-kind from a Trust.
I know you can do it, the problem is the taxation of it. My only reasoning for taking it in-kind would be to bypass capital gain taxes at the Trust's level. I have found websites that discuss in-kind transfers when you are dissolving a trust and how it is allocated to the beneficiary, but this is not the case.
That is why I turned to Turbotax in the hopes I could get some advice from a CPA, which I have been able to do in the past.
I have found it much more difficult to find the right category to post this question. I used to just post it in the general community , but I tried twice and it never showed up.
