Income earned by a grantor trust is taxed to the settlor. In contrast income earned by a non-grantor trust is generally taxed to the trust (unless distributions shift income to beneficiaries). Knowing the difference between the two is imperative for practitioners. In this episode, Marty and Jonathan discuss:
What makes a trust a grantor trust?
What makes a trust a non-grantor trust?
When would you use a grantor trust?
When might you use non-grantor trusts?
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