Bonita is considering establishing a trust for her mother that will pay out $1,000 each month. The trust department at a local bank will act as trustee. Bonita will retain the right to revoke the trust and be the remainder beneficiary of the trust. If the trust earns $15,000 for the year, who must pay income tax on earnings?

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14 November, 00:28

Bonita is considering establishing a trust for her mother that will pay out $1,000 each month. The trust department at a local bank will act as trustee. Bonita will retain the right to revoke the trust and be the remainder beneficiary of the trust. If the trust earns $15,000 for the year, who must pay income tax on earnings?

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Zachary Rangel · Answer 1

The Dependent or the Beneficiary collect $1000 every month pay income tax

Explanation:

Bonita is the policyholder that pay premium.

The mother is the dependent and the beneficiary, who takes the trust monthly

The bank is the trustee that disburse the trust fund to the beneficiary month.