CA Withholding on Trust Distributions to Nonresidents and 3 1/3% - Spidell

CA Withholding on Trust Distributions to Nonresidents and 3 1/3%

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Message Board CA Withholding on Trust Distributions to Nonresidents and 3 1/3%

This topic contains 1 reply, has 2 voices, and was last updated by Lynn Freer 1 month ago.

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  • #181075
    Barbara Foust
    Participant

    I have a CA trust with several CA nonresident beneficiaries. Real estate was sold in 2019 and 3 1/3% of the gross proceeds was withheld for CA withholding purposes. If the trust distributes the cash from the sale of the real estate to the beneficiaries, including the nonresident beneficiaries, does the trustee have to withhold an additional 7% on the distributions to the nonresident beneficiaries?

  • #181217
    Lynn Freer
    Participant

    Technically, yes. However you can request a withholding waiver request on Form 588 or 589 based on the withholding passed through to the beneficiary, which you must do via a Form 592. The trust document is what determines when and whether the income and withholding must be passed through