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joe5050
Level 2
Apr 9, 2023 3:17 PM UTC
Solved

trust

how do you determine if a distribution from a trust is tier 1 or tier 2. The trust in question is a complex trust that does not require yearly distributions.

 

thank you.

    Anonymous_Answer
    Level 15
    Apr 9, 2023 3:24 PM UTC

    Tier 2 distributions would be all amounts paid to beneficiaries other than Tier 1 distributions.

     

    Tier 1 distributions are mandatory (they are required to be paid) and not discretionary.

     

    Ref Section 662(a)(1)

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    2 replies

    Anonymous_Answer
    Level 15
    Apr 9, 2023 3:24 PM UTC

    Tier 2 distributions would be all amounts paid to beneficiaries other than Tier 1 distributions.

     

    Tier 1 distributions are mandatory (they are required to be paid) and not discretionary.

     

    Ref Section 662(a)(1)

      Anonymous_
      Level 15
      Apr 9, 2023 3:27 PM UTC

      If no distributions are required, then any that are actually made would generally be Tier 2.

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