How do trusts affect my taxes?

How do trusts affect my taxes?

Trusts can have various tax implications depending on their structure. Are you referring to a revocable or irrevocable trust?

I'm looking at setting up an irrevocable trust. What should I know?

Irrevocable trusts generally remove assets from your taxable estate, which can reduce estate taxes. However, the trust itself may be taxed on its income.

What about capital gains taxes on assets in the trust?

Capital gains taxes can apply to assets sold by the trust. If the trust sells an asset, it may owe capital gains tax on the profit.

Are there any deductions or credits available for trusts?

Yes, trusts can sometimes deduct certain expenses, like administrative costs, and may qualify for specific tax credits depending on their activities.