Trust Disbursement
What is the best way to disburse inherited securities that are in a trust? In-kind and let the beneficiary deal with the sale as well as gains/losses and taxes or liquidate the securities while in the trust and let the trust absorb the gains/losses and taxes?
Permalink Submitted by William Tuttle on Tue, 2022-03-08 01:16
In most trusts, the income can also be distributed and taxable to the beneficiaries.
Except to the degree necessary for trust expenses, equitable distribution of trust assets and/or trust directives. The decisions on trust distributions should be in according with trust directives and based on facts, circumstances and desires of the beneficiaries.
I.e. With step-up basis recently after death, it may be beneficial to some beneficiaries to receive cash distributions.
However, some other beneficiaries may have specific tax situations or emotional attachment to the securities invested in and prefer to sell or not at a date of their own choosing.