Further, with respect to multiple trusts, Congress has already given the necessary weapons to combat the multiple trust "evil" in 1976 by the enactment of heavy penalties levied on distributions from more than two accumulation trusts
to the same beneficiary for any taxable year [IRC Sec.
Under the throwback rules, severe penalties are levied on beneficiaries of multiple accumulation trusts. A penalty is imposed when a beneficiary receives an accumulation distribution from more than two trusts with respect to the same prior tax year, subject to a $1,000 de minimis rule.(92) The "gross up" for taxes paid by the trust is not permitted.
643(f),(94) under regulations to be prescribed by the Treasury, two or more trusts that are not accumulation trusts will be treated as one trust for income tax purposes if: 1.