What if I had a taxable distribution from a qualified disability trust?

If you had a taxable distribution from a qualified disability trust, review the trust information below to determine your earned income from the trust.

Earned income includes any taxable distribution from a qualified disability trust.

A qualified disability trust is any nongrantor trust:

1. Described in 42 U.S.C. 1396p(c)(2)(B)(iv) and established solely for the benefit of an individual under 65 years of age who is disabled, and
2. All the beneficiaries of which are determined by the Commissioner of Social Security to have been disabled for some part of the tax year within the meaning of 42 U.S.C. 1382c(a)(3).

A trust won't fail to meet (2) above just because the trust's corpus may revert to a person who isn't disabled after the trust ceases to have any disabled beneficiaries.