Trust Subject to 3.8% investment surtax
Good Afternoon
My understanding is trust’s are subject to the new 3.8% investment surtax upon the trust accummulating $11,950 of income
questions
Does the apply to all trusts (beneficiary trust, revocable, irrevocable, etc)?
How is the surtax calculated?
Thank you
Permalink Submitted by mk foss on Mon, 2013-06-03 19:16
The 3.8% investment surtax does apply for trust income over $11,950 that is not distributed. IRS has not yet released the form and the proposed regulations are not totally clear as to how exactly the surtax will be calculated. Expenses can offset the income but how they are applied, how state income taxes affect the net investment income etc is not clear.- Many believe that the tax will be calculated on a separate form just as individuals to for the AMT calculation.- Also the 20% tax rate on long term capital gains will apply with income in excess of $11,950.