In lieu of the deduction for personal exemptions provided by section 151:
(a) An estate is allowed a deduction of $600,
(b) A trust which, under its governing instrument, is required to distribute currently all of its income for the taxable year is allowed a deduction of $300, and
(c) All other trusts are allowed a deduction of $100.
A trust which, under its governing instrument, is required to distribute all of its income currently is allowed a deduction of $300, even though it also distributes amounts other than income in the taxable year and even though it may be required to make distributions which would qualify for the charitable contributions deduction under section 642(c) (and therefore does not qualify as a “simple trust” under sections 651-652). A trust for the payment of an annuity is allowed a deduction of $300 in a taxable year in which the amount of the annuity required to be paid equals or exceeds all the income of the trust for the taxable year. For the meaning of the term income required to be distributed currently, see § 1.651(a)-2.
authority: Section 1.642(c)-6 also issued under
26 U.S.C. 642(c)(5)
source: T.D. 6500, 25 FR 11814, Nov. 26, 1960; 25 FR 14021, Dec. 31, 1960, unless otherwise noted.
cite as: 26 CFR 1.642