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New Member
posted Jun 6, 2019 1:27:59 AM

Can capital gains be allocated to a beneficiary in a trust through a K-1

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1 Best answer
Level 15
Jun 6, 2019 1:28:01 AM

"can capital gains be allocated to a beneficiary in a trust through a K-1"

Yes, provided the gains are distributed pursuant to the terms of the trust instrument and applicable local law, or pursuant to a reasonable and impartial exercise of discretion by the trustee.

See Treas. Reg. §1.643(a)-3(b)

1 Replies
Level 15
Jun 6, 2019 1:28:01 AM

"can capital gains be allocated to a beneficiary in a trust through a K-1"

Yes, provided the gains are distributed pursuant to the terms of the trust instrument and applicable local law, or pursuant to a reasonable and impartial exercise of discretion by the trustee.

See Treas. Reg. §1.643(a)-3(b)