Title 26 — Internal Revenue CodeRelease 119-73

§651 Deduction for Trusts Distributing Current Income Only

Title 26 › Subtitle Subtitle A— Income Taxes › Chapter 1— NORMAL TAXES AND SURTAXES › Subchapter J— Estates, Trusts, Beneficiaries, and Decedents › Part I— ESTATES, TRUSTS, AND BENEFICIARIES › Subpart B— Trusts Which Distribute Current Income Only › § 651

Last updated Apr 6, 2026|Official source

Summary

A trust whose terms require all of its income to be paid out to beneficiaries each year, with nothing set aside for charity, gets a deduction tied to the income it must distribute. If the income required to be paid out is more than the trust's distributable net income for the year, the deduction is capped at the distributable net income. That computation leaves out income items not included in the trust's gross income and the deductions tied to them.

Full Legal Text

Title 26, §651

Internal Revenue Code — Source: USLM XML via OLRC

(a)In the case of any trust the terms of which—

(1)provide that all of its income is required to be distributed currently, and

(2)do not provide that any amounts are to be paid, permanently set aside, or used for the purposes specified in section 642(c) (relating to deduction for charitable, etc., purposes),

(b)If the amount of income required to be distributed currently exceeds the distributable net income of the trust for the taxable year, the deduction shall be limited to the amount of the distributable net income. For this purpose, the computation of distributable net income shall not include items of income which are not included in the gross income of the trust and the deductions allocable thereto.

Reference

Citations & Metadata

Citation

26 U.S.C. § 651

Title 26 — Internal Revenue Code

Last Updated

Apr 6, 2026

Release point: 119-73