With her near-sightedness, and those tremulous fingers of hers, at once inflexible and delicate, she could not be a seamstress; although her sampler, of fifty years gone by, exhibited some of the most recondite specimens of ornamental needlework.
State taxes on family trusts vary, but federal laws require family trusts to pay taxes on income it keeps but not on any that is distributed. A trust that earns $50,000 and distributes it all to trust beneficiaries pays no income tax. The beneficiaries pay income taxes on funds given to them.
Income Taxation of Trusts and Estates Income Taxed to Either Entity or Beneficiary â If income is accumulated and not deemed distributed, it is taxed to the trust or estate â If income distributed: â¢ Trust gets deduction for amount of distribution â¢ Beneficiary accounts for income distributed on his own tax return