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Generation Skipping Trust tax?

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brsedu

Junior Member
What is the name of your state (only U.S. law)? California

I am the beneficiary of a GST - Generation Skipping Trust - set up by my grandmother, to be the recipient of money upon her death. This trust included investments in stock and bonds, etc. She died a couple of months ago and my question is about taxation of this money.

The trust was set up for me and my 2 siblings and the allowed maximum $2 million was put in there and is to be split 3 ways when the estate settlement is done. I was told that I might need to pay taxes on "realized net capital gains." This trust has decreased in value with the market and is now worth less than the original $2M. Does this mean that I may need to pay taxes on what was earned from the investments? What if there were no earnings, only losses (as is my case)?. Will I need to pay some kind of taxes on the entire amount of my share? I thought that the benefit of a GST was such that taxes were not part of it? The trustees only give me legal jargon and I can't seem to decipher what it really means. Can someone explain it to me in layperson's terms?What is the name of your state (only U.S. law)?
 


Dandy Don

Senior Member
If you received no tax statements then there is most likely no tax obligation on your part. Most probably the trust is liable for that tax obligation. But your question is so complicated that only a consultation with a local CPA or tax accountant who has experience with trusts can advise you properly.

DANDY DON IN OKLAHOMA ([email protected])
 

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