A beneficiary of a trust that operates a trade or business is not engaged in the trade or business. This is because the trust rather than the beneficiary is engaged in the activity. However, a trade or business that is carried on by a conservator, committee, or guardian on behalf of an incompetent is considered as carried on by the incompetent. This is true even if the person has been legally adjudged as incompetent.
Last Revised: Aug. 25, 2009