Simple Trust vs Complex Trust

Simple Trust vs Complex Trust

Simple Trusts must meet criteria set by the IRS:
  1. Must be a non-grantor trust
  2. Must distribute income earned on trust assets to beneficiaries annually
  3. Make no principal distributions
  4. Make no distributions to charity
Complex Trusts must do one of the following annually:
  1. Not distribute all of its income to beneficiaries
  2. Distribute some or all of the principal assets to beneficiaries
  3. Distribute any assets to charitable organizations

The Bulletproof Trust is a complex trust by definition of its ability to be for general welfare and nonsequential distribution of assets to beneficiaries.

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