65 Day Rule For Trust Distributions 2025. Unlocking the Secrets of the 65Day Rule for Trust Distributions For example, a distribution of $700 of trust income by the trustee to a beneficiary on January 20, 2025, can be treated as having been made in the 2024 tax year or the 2025 tax year Nor will a grantor trust qualify for this 65-day rule
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By making the timely election and distributing within 65 days, fiduciaries can effectively allocate income to beneficiaries and avoid tax at the trust level. The election is made by the trustee on the trust's tax return deadline of April 15, 2025, or September 30, 2025, for returns on extension.
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Nor will a grantor trust qualify for this 65-day rule 65-Day Rule: The Tax Code also permits some planning during the first 65 day of the calendar year, where the trustee can make distributions via an election that will count toward the prior year's distribution to the trust beneficiary from the trust This 65-day rule provides an opportunity to shift income out of a trust and to beneficiaries, even if those distributions are made outside of the 2024 calendar year
Required Minimum Distribution Relief for IRAs John McCarthy, CPA. The 65-day rule under Internal Revenue Code 663 (b) allows trustees of a trust to treat distributions that are made within the first 65 days of the trust's tax year as if they were paid or credited on the last day of the preceding tax year The election is made by the trustee on the trust's tax return deadline of April 15, 2025, or September 30, 2025, for returns on extension.
Today’s presenters Alissa Bowers Private Client Services Manager. In summary, the 65-Day Rule offers fiduciaries a valuable tool for managing the taxable income of a trust and optimizing the income distribution deduction One of the tax planning tools available to fiduciaries of estates and non-grantor trusts is the 663 (b) election, also known as the "65-day rule." Simply put, a 663 (b) election allows distributions made to beneficiaries within 65 days of year-end to be counted as prior-year distributions.