Estate Law Questions? Ask an Estate Lawyer.
Good afternoon. I am Loren, a licensed attorney, and I look forward to assisting you.
What is being netted out of the income to be distributed?
Typically, the income distributed is net of expenses. Otherwise, if all income is distributed without accounting for expenses, the trust would be insolvent.
Most trust agreements do contain boilerplate language that the trustee should pay trust expenses from the income. If not, the trustee usually has broad powers under the trust agreement to manage the assets and that is usually interpreted in paying lawful expenses.
No, as I said, it has to be net income or else the estate would be insolvent. The trust can not distribute gross income.
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