Since this is a hugely mis-understood subject that seems to come up multiple times a week:

Gifter: They don’t pay any tax until they exceed $12.06M in their lifetime. They have to report gifts over $16k in a given tax year but it’s not taxed.

Receiver: Never pays gift or income tax on gifts. Doesn’t matter how large the gift is.

https://turbotax.intuit.com/tax-tips/estates/the-gift-tax-made-simple/amp/L5tGWVC8N

There is never a "gift tax" to the receiver, even though it is a common misconception.

There *could be* a tax consequence to the giver, depending on their overall lifetime gifting amounts, but since everything is part of a trust, it's even more complicated than that because the trust has its own EIN and tax filings.

You probably need to talk to a CPA or estate planning attorney.

Argh, forgot to add this to my last reply

Recipients of funds from a trust:

https://www.investopedia.com/ask/answers/101915/do-beneficiaries-trust-pay-taxes.asp

You’d pay the income tax on gains of assets in the trust but not money that is principal.

You listed the grantors and trustee, but you failed to list who the beneficiary(ies) of the trust are. If you're a beneficiary and the trust document allows distributions for this reason or at will, you can do this. If your mother is the beneficiary, she would have to take the distribution and gift the money to you, though there won't be any gift tax. You need to be careful as a trustee to not abuse your powers. If you aren't a beneficiary and think you can distribute funds to yourself and consider this an investment, it's not and that could be an issue later.

I'm a beneficiary, along with my mother and my brothers. My mom and I have talked about this as part of a potential retirement plan for her where if I want to upgrade to a bigger house in 5 years or so and she can rent out her large house (which she owns outright) as her retirement income.

> that could be an issue later

Who has potential to make this an issue? My mom given that she is the only remaining grantor?

Assuming you are a beneficiary of the trust, and the trust is now irrevocable (not a living, revocable trust), any distributions from the trust to you are never a "gift", they are a distribution.

Part or all of the distribution may be taxable income to you. The trustee(s) of the trust can decide whether they are distributing principal or income to you, and in what percentage. This will be reflected in the Form K-1 that the trust will have to issue to you. Any of the trust's income (dividends, interest, capital gains) that are distributed to you as part of the distribution can either be taxable to you, or the trust can retain the tax liability and pay the taxes itself -- this is at the discretion of the trustee(s) (unless the trust document says otherwise).

On the other hand, if it is simply a revocable, living trust, then the fact that it is a trust is basically irrelevant. In that case, it is a gift from your mom to you, and the receiver of a gift never owes taxes. Your mom probably wouldn't owe taxes either, just will need to fill out extra forms at tax time to add it to the "lifetime exclusion".