My question should read "won't I pay tax a second time on the same money when I pay taxes later on my IRA distributions? The same money as listed on the 990-T will be paid out to me at some point as a distribution, at which time I'll pay income tax on it. That would make the second time that I had paid taxes (once by the custodian on the 990-T now, and a second time later by me when I take the distribution, on my 1040.) Therefore, I should be able to list the taxes paid on my 1040 now since I am paying them now (by the custodian on the 990-T). Or, if not that, then I should be able to subtract the UBIT dollar amount upon which the 990-T tax was paid from the distributions when I receive them.  If tax on $25,000 is paid now by the IRA custodian, then if I receive a $40,000 IRA distribution next year, I should only have to pay tax on $15,000. Otherwise I'm paying twice on the same $25,000 income." ... View more

Thanks--sadder but wiser. ... View more

If my IRA custodian paid 990-T taxes on $25,000 of income in my IRA now, and I then receive a $40,000 IRS distribution in 2019, I should pay income tax (on my 1040) on $15,000, not $40,000. Otherwise I'm paying tax on the same $25,000 twice. ... View more