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Returning Member
posted Oct 25, 2023 11:15:51 AM

My parents had a living trust. Will the trust owe taxes after they die?

Both my parents have passed on. They had a trust for us kids. Will the trust owe taxes for 2023?

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1 Best answer
Employee Tax Expert
Oct 25, 2023 11:29:55 AM

Hello @thesherrya , thank you for being here. Sorry about your parents. 

The trust can't pay taxes on distributed income but the trust is responsible for paying any taxes due prior to any distribution. The beneficiary must pay the tax on the income from issued by the trust. For more information please click on the link below regarding Schedule K-1 beneficiary's share of income, deductions, credit, etc.

https://www.irs.gov/forms-pubs/about-form-1041

2 Replies
Employee Tax Expert
Oct 25, 2023 11:29:55 AM

Hello @thesherrya , thank you for being here. Sorry about your parents. 

The trust can't pay taxes on distributed income but the trust is responsible for paying any taxes due prior to any distribution. The beneficiary must pay the tax on the income from issued by the trust. For more information please click on the link below regarding Schedule K-1 beneficiary's share of income, deductions, credit, etc.

https://www.irs.gov/forms-pubs/about-form-1041

Employee Tax Expert
Oct 25, 2023 11:30:52 AM

*issued K-1