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Assume a person is one of the beneficiaries of a dynasty trust fund. The dynasty trust is irrevocable and perpetual, set in a US state that allows perpetual trusts. Annual distribution of the trust to this person is above the legal limit to file for chapter 7, maybe forcing her to file under chapter 13.

Being irrevocable, the trust fund cannot be used to settle the debts.

But do the trust fund distributions count as income on form 122A-1?

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    What did your lawyer say?
    – Pete B.
    Aug 9, 2021 at 11:53
  • @PeteB. That's a nice point, really (no sarcasm intended). I'm not seeking legal advice, I'm seeking a stack answer regarding a personal finance issue for non-binding purposes. If I had a real lawyer's opinion, I'd post said answer but alas, I don't.
    – Mindwin Remember Monica
    Aug 10, 2021 at 22:42

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