What is the 65 day rule for estates and trusts?

The 65-day rule for estates and trusts is a provision in the United States tax code that allows trustees or executors of estates to make certain tax decisions after the close of the tax year, but before the due date of the tax return.

Specifically, the rule allows trustees or executors to make certain elections related to the distribution of income and deductions to beneficiaries of an estate or trust for the prior tax year. This can have significant tax implications for both the estate or trust and the beneficiaries.

To take advantage of the 65-day rule, the trustee or executor must file an election with the IRS on or before the 65th day after the close of the prior tax year (which is usually March 6th). This election allows the trustee or executor to treat certain distributions as having been made in the prior tax year, even if they are actually made in the current tax year.

It's important to note that the 65-day rule only applies to certain types of distributions, and there are specific requirements that must be met in order to qualify. Therefore, if you are a trustee or executor of an estate or trust, it's recommended to consult with a tax professional to ensure you are following all the necessary rules and regulations.