What was the result of Rev Rul 59-361?

Answer 1

Rev. Rul. 59-361 established that a trust created for the benefit of a beneficiary, where the trustee had discretion to make distributions, could be treated as a grantor trust. This means that the grantor of the trust would be treated as the owner for tax purposes, and thus responsible for reporting the income generated by the trust's assets on their personal tax return. The ruling clarified the circumstances under which a trust could retain grantor trust status despite the trustee's discretionary powers.