Tust

I will be receiving money from a trust left to me by my parents. The trust was generated in Calif. and I live in Texas.

Will I have a tax liability for the money received from the trust? If so, is there a web site I can go to to obtain additional, easy to understand, info regarding this subject?

Trust income

The money you receive out of trust income is taxable to you. Any amount you receive from trust principal is not. The trustee should send you a form each year telling you what portion is taxable. The federal schedule is form 1041, Sch K1.

IRS Publication 17 has an easy to understand explanation of trust income. You can download Pub 17, or read it on-line at http://www.irs.ustreas.gov/forms_pubs/index.html.

In order to qualify as gross income that is taxable, income must not only be of the type that is taxable, but must also derive from a taxable source, as narrowly defined in IRC section 861 (26 U.S.C. 861). Nowhere in this section do you find income from domestic sources as being classifed as "gross income" from a taxable source.

Clarification

I agree, you are taxed on the distributions you get out of the taxable income of the trust. The nontaxable income of the trust, if any, is also nontaxable to you.