Question:
How do taxes work with a Trust? What do I need to know?
Answer:
For tax purposes, the Trust property is treated as if you remained the owner. Until your death, income from the Trust is reported on your federal income tax return. After your death, the Trust is assigned a federal tax identification number and becomes a separate entity for tax purposes.
A Trust can be used to avoid estate taxes. At McGinty & Belcher, we can help you design a Trust that will provide the most favorable tax treatment for you and your heirs.