What taxes are you worried about? Life insurance payout is not taxable income. Only interest after death is income. Talk to a tax accountant or tax attorney for specific advise based on the terms of the trust and future distributions.
The comments above are not legal advice and do not create an attorney-client relationship: you haven't hired me or my firm or given me confidential information by posting on this public forum, and my answer on this public forum does not constitute attorney-client advice. IRS Circular 230 Disclosure: In order to comply with requirements imposed by the Internal Revenue Service, we inform you that any U.S. tax advice contained in this communication (including any attachments) is not intended to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein. While I am licensed to practice in New York and California, I do not actively practice in New York. Regardless, nothing said should be deemed an opinion of law of any state. All readers need to do their own research or pay an attorney for a legal opinion if one is necessary or desired.
I agree with my colleague, you should speak with a tax attorney or accountant. They will need to see the trust documents so that they can discuss the tax consequences of the life insurance proceeds now and in the future.