Legal Question in Wills and Trusts in California
Must income to the trust be distributed to the mandatory income beneficiary in the year it is received, or may it be held for payment of anticipated legal fees for a beneficiary-requested trust accounting or for defense from breach of trust accusations?
What if the trustee conceals its existence for the rest of the tax year, lists it without its source on an accounting summary at tax time, admits on the annual accounting summary that the income beneficiary was sent a payment from principal each month, and lists very different income sources and amounts on the K-1?
What if it was really from a liquidation in another trust?
How does the trustee's status as remainder beneficiary who is related to trustor and income beneficiary, and wrote the trust instrument, affect the answer?
3 Answers from Attorneys
Make and keep an appointment with a probate specialist and bring the trust.
you should retain a qualified attorney to assist you with understanding the trust, answering your numerous questions and providing advice.
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