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Richard
Richard, Tax Attorney
Category: Tax
Satisfied Customers: 53996
Experience:  29 years of experience as a tax, real estate, and business attorney.
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If I am receiving a distribution from a family trust for

Customer Question

If I am receiving a distribution from a family trust for $160,000 for a down payment on a house how much money will I owe from that in taxes?
Submitted: 1 year ago.
Category: Tax
Expert:  Richard replied 1 year ago.

Good afternoon. Can you provide me a bit more information?

Is this a distribution of trust principal? Is this family trust an irrevocable trust or a revocable living trust? Thanks!

Customer: replied 1 year ago.
Hey Richard,
I believe this will be a distribution of income not principal, all I know is it is a residuary family trust.
Expert:  Richard replied 1 year ago.

Thanks for following up. If it's a distribution of income, it will depend upon whether or not the trust has already paid the tax on the income. Tax does not have to be paid twice on the same income. So, if the trust has paid the tax already on the income....check with the trustee....then you would not owe tax on the distribution. If not, then you would be taxed on the income at your ordinary marginal income tax rate which would depend upon your other income. You can find you the Federal marginal rates on your income at the following link: http://www.consumerismcommentary.com/2015-federal-income-tax-brackets-marginal-rates/ . You can find the CA income tax rates at the following link: http://www.tax-rates.org/California/income-tax . You will be credited on your Federal return for any California income taxes paid.

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