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Complex Trusts

Simple Trusts vs. Complex Trusts

For tax purposes, trusts are either filed as simple or complex. A simple trust must distribute all income to the beneficiaries, it cannot distribute principal, and it cannot make distributions to charities. A complex trust does one or more of the things that a simple trust cannot do: it can accumulate income, distribute principal, or make distributions to charity.

Navigating Complex Trusts

Complex Trust Distributions

With a complex trust, distributions can include ordinary income, stock, capital gains and even principal. There may also be a deduction for distributions to charities. The result of these extra abilities is that the allocation of the tax and any deductions between the trust and its beneficiaries can be quite complex, hence its name.

Children as Beneficiaries

It can be especially complex when it comes to children who have been named as beneficiaries of an IRA or 401k. Companies can’t legally pay out those allocations to minors without a guardianship, and considerations must be made for all of the taxes that build up.

We're Ready to Help

At Kiselstein Franckowiak Law Group we will guide you through the complex trust process in a clear and patient manner. Our attorneys are experts at navigating the tax intricacies and details that come with this type of trust.

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