Updated October 5, 2026. Quick answer: Yes. Delaware taxes trust income at graduated rates of 2.20% to 6.60% on the 2025 Form FID-TAX schedule, and the statute says “The tax imposed by Chapter 11 of this title on individuals” shall apply to the taxable income of estates and trusts.
How Delaware treats trust income
| Item | What the documents say |
|---|---|
| Treatment | Delaware applies its personal income tax to trusts and estates, and the fiduciary files Form FID-TAX, the Fiduciary Income Tax Return. In the source’s words, “shall be computed on such taxable income and shall be paid” by the fiduciary under the statute. |
| Who counts as a resident trust | A resident trust is one created by the will of a Delaware domiciliary, or created by or consisting of property of a person domiciled in Delaware, or one that meets a trustee test for more than half of the taxable year. In the source’s words, “Created by, or consisting of property of, a person domiciled” in this State is one of the statutory tests, and the trustee tests turn on a Delaware resident individual trustee or an entity with a Delaware trust office. |
| Rate on trust income | The 2025 form prints a seven step schedule that starts at 0 on the first $2,000 and reaches 6.60% on income over $60,000. The source says: “$2,943.50 + 6.60% OF AMOUNT OVER $60,000.” The lowest taxed bracket prints as 2.20% of the amount over $2,000. |
| Distribution deduction | The documents read do not set out a state distribution deduction of their own. Delaware taxable income starts from federal taxable income on Form 1041, and the state allows a separate deduction for income set aside for nonresident beneficiaries. In the source’s words, “set aside for future distribution to nonresident beneficiaries” is the only beneficiary related deduction the statute grants a resident trust. |
| Nonresident trusts | A nonresident trust is taxed on items of income, gain, loss and deduction derived from or connected with Delaware sources, less its federal exemption. The source says: “mean those derived from, or connected with, sources in this State.” The instructions treat income from Delaware real or tangible property or a Delaware business as Delaware source income. |
| Return to file | Resident and nonresident trusts with the filing triggers file Form FID-TAX with a copy of federal Form 1041 attached, and calendar year returns are due April 30. In the source’s words, “Fiduciary Income Tax Returns are due on or before April 30th” following the close of the taxable year for calendar year filers. |
| Estimated tax and electing small business trusts | A trust with assets of $1 million or more at fair market value must file Form FID-EST declarations for the following year, and electing small business trust income is reported on separate lines of Form FID-TAX. In the source’s words, “equals or exceeds $1 million, the trust is required to file” estimated tax declarations. |
A $10,000 example
On the 2025 form schedule, a trust with $10,000 of taxable income is in the band the form prints as $66.00 plus 3.90% of the amount over $5,000, computed as $66.00 + ($10,000 minus $5,000) x 3.90% = $261, before any credit the state allows. The first $2,000 is taxed at 0 on that schedule. Federal tax on the trust’s income still applies.
Income the trust passes out to a beneficiary is handled as the distribution deduction row above describes.
What changes in 2026
The latest documents read print no 2026 change to how trust income is taxed.
Federal rules
The state’s treatment sits on top of the federal one. The federal brackets a trust faces are laid out in trust tax brackets versus individual brackets, and capital gains that a trust keeps are covered in capital gains stay in the trust. The IRS explains the federal return in the About Form 1041 page.
Related: how Delaware taxes retirement income, whether Delaware taxes pensions, what a living trust costs in Delaware, federal trust tax brackets, and trust income tax by state.
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Answer againSources
- Delaware Form FID-TAX Fiduciary Income Tax Return, 2025 (Delaware Division of Revenue): https://revenuefiles.delaware.gov/2025/PITForms_Instructions/FID-TAX_2025-01_PaperInteractiveIPM.pdf
- Delaware Form FID-TAX Fiduciary Income Tax Return Instructions, 2024 (Delaware Division of Revenue): https://revenuefiles.delaware.gov/2024/PIT_2024_Forms/PIT_Instructions/TY24_FID-TAX_2024-01_Instructions.pdf
- 30 Del. C. Chapter 16, Subchapter III, Taxation of Estates, Trusts and Their Beneficiaries (Delaware Code Online): https://delcode.delaware.gov/title30/c016/sc03/index.html
- 30 Del. C. Chapter 16, Subchapter I, Definitions, section 1601 (Delaware Code Online): https://delcode.delaware.gov/title30/c016/sc01/index.html
Sources: the primary documents linked above, read on October 5, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the plan administrator or the agency itself is the right place to confirm anything consequential.