12.2 - Beneficiary's Taxable Income --- Estates, Trusts & Wealth Transfer Taxes

Question 1

Simple Trust:

How are beneficiaries taxed in a simple trust?

Answer 1

• Beneficiary taxed on lower of trust income required to be distributed or proportionate share of DNI

Question 2

Estates & Complex Trusts:

How are beneficiaries taxed in estates and complex trusts?

Answer 2

• Beneficiary taxed on fiduciary income required to be distributed, plus additional distributions

Question 3

Estates & Complex Trusts:

What is the beneficiary’s taxable amount limited to in estates and complex trusts?

Answer 3

• Taxable amount limited to share of DNI

Question 4

Estates & Complex Trusts:

How are excess distributions treated in estates and complex trusts?

Answer 4

as a principal distribution

Question 5

Schedule K-1:

What form is used to report the beneficiary’s share of taxable income, deductions, and credits from trust or estate?

Answer 5

Schedule K-1

Question 6

Character:

Identify the character of the beneficiary’s taxable income

Answer 6

Same as in the hands of the trust or estate