Description: Tax professionals are called upon to answer questions by clients, trustees, and beneficiaries; to advise regarding subtrust funding; to attribute items to principal and income; and, to report trust income and pass through taxation. But how do you do it unless you know how to read a trust? In this session, we will learn who is legally entitled to trust information (and who you should never speak with). We will learn to identify trustees and how to determine what is principal and what is income. Most important, we will dig deeply into the concept of “distributable net income” and how it flows through Form 1041 and Schedule K-1.
S18-How to Read a Trust
Thursday, June 27 | 1:20 pm - 3:00 pm
2 hours Federal Tax Law (EA, CRTP, OTRP)
2 hours Taxes/Tax Planning (CPA, CFP)
1.75 hours Taxation Law (Attorney – CA Bar MCLE)
2 hours (CSEA/NAEA)
Speaker: Frank R. Acuña, Esq.
1. Understand trust structures and the essential elements to create a trust
2. Identify settlors/grantors, trustees, and beneficiaries and the persons legally entitled to trust and tax information
3. Identify principal and income under the trust, state law, federal law, and generally accepted accounting principles and when each of these sources apply
4. Determine whether a trust is “simple” or “complex”
5. Understand and correctly report “distributable net income” and expenses of administration, among other items
Learning Level: Introductory
Advanced Preparation: None