Estates and Trusts
Estates and trusts may be subject to income tax at the estate or trust level, or the beneficiaries may be subject to income tax on their share of income. Where the all income must be distributed, the beneficiaries are taxed similarly to partners in a partnership. Where income may be retained, the estate or trust is taxed. It may get a deduction for later distributions of income. Estates and trusts are allowed only those deductions related to producing income, plus $1,000. They are taxed at graduated rates that increase rapidly to the maximum rate for individuals. The tax rate for trust and estate income in excess of $11,500 was 35% for 2009. Estates and trusts are eligible for the reduced rate of tax on dividends and capital gains through 2011.
Read more about this topic: Income Tax In The United States
Famous quotes containing the words estates and, estates and/or trusts:
“I hate the noise and hurry inseparable from great Estates and Titles, and look upon both as blessings that ought only to be given to fools, for ‘tis only to them that they are blessings.”
—Mary Wortley, Lady Montagu (1689–1762)
“No man, however benevolent, liberal, and wise, can use a large fortune so that it will do half as much good in the world as it would if it were divided into moderate sums and in the hands of workmen who had earned it by industry and frugality. The piling up of estates often does great and conspicuous good.... But no man does with accumulated wealth so much good as the same amount would do in many hands.”
—Rutherford Birchard Hayes (1822–1893)
“No married woman ever trusts her husband absolutely, nor does she ever act as if she did trust him. Her utmost confidence is as wary as an American pickpocket’s confidence that the policeman on the beat will stay bought.”
—H.L. (Henry Lewis)