For irrevocable trust, trustee is responsible for tax liabilities generated by trust asst. So, is the tax paid from trustee’s own pocket or is the tax used to deduct trust asset value? And is the tax rate the ordinary tax rate of trustee?
the grantor gives assets to the trust and has paid any required taxes at that point (gift taxes, cap gains, etc) . Any income generated by the trust is the responsibility of the irrevocable trust, which has higher tax rates on a progressive level in the USA . The rates start high and very early in the scale.
To answer your question, does the CFO pay the corporation’s taxes out if their own pocket or out of the companys piggy bank?