1099B issued to a trust

[floridabound99]

I have a trust that I do not take any funds from. It was the result of my dad passing away and splitting up the estate. It is all investment income that I do not want to touch. I have a second trust that is an educational trust set up for grandchildren, which is untouched as well.

As trustee, I have been issued a 1099B in the name of each trust, with short and long term - BoxA and BoxB totals with cost basis reported to the IRS.

Since this is a Trust with it's own Tax Number, how do I handle it? Last year I wrote a personal check for the taxes, but it is listed as a BENEFICIARY IRA, and TT says not to report sales on investments held within an IRA, 401(k)...

Thx

[Anonymous_]

Can you provide additional details or, at least, some clarification?

As you described the 1099-B, Box A and Box B would typically both be proceeds from short-term transactions (Box A would be where the basis was reported to the IRS while Box B would be where the basis was not so reported).

With respect to the "Beneficiary IRA", was this IRA actually inherited from your dad and, if so, was the trust named as the beneficiary? Alternatively, were you (individually) name as the beneficiary of the IRA? 

[Mike9241]

I have a trust that I do not take any funds from. It was the result of my dad passing away and splitting up the estate. It is all investment income that I do not want to touch.

what does the trust document say about income distribution?  it's the trust document/state law that determines if income must be distributed.   

I have a second trust that is an educational trust set up for grandchildren, which is untouched as well. who is the grantor and trustee of the trust? if you are both the grantor and trustee, the tax laws would likely treat it as a grantor trust which means any income would be taxed to you and not the trust.

the fact that the trusts have their own EIN is irrelevant as to how and where the income is taxed

  the following is confusing."BENEFICIARY IRA"   is what you inherited from your father some or all of his IRA a/c.  special rules apply to when beneficiaries must start taking distributions from inherited iRAs

without clarification, it;'s not possible to tell you what you need to report and what form to report it on.

[floridabound 99]

Thanks - the trust was established a couple years ago, after the law changed. I know I have to take all distributions in 10 years. The issues is whether the inherited IRA trust needs to pay tax now on the capital gains or if that is deferred.

The original trust was only in existence long enough to be split into 3 separate and equal trusts.

 All of them are labeled as inherited IRAs.

There is no stated requirement to distribute ant income.

The educational trust was set up automatically, not by me, but based on the will and trust documents from my dad.

Sorry about not clarifying!

[Anonymous_]

I, for one, am still confused. 

Do you have an inherited IRA that had three named beneficiaries or was your (deceased) father's IRA split into three separate trusts?

Further, what capital gains? With an inherited IRA you usually would not have a recognition event unless there was a distribution.