We study how institutional quality and perceived neediness moderate the relationship between generalized trust and preferences for redistribution to the needy. Following Algan et al. (2016), we hypothesize that trusting individuals are more supportive of redistribution in favor of target groups with a low cost of free-riding, like the poor or the unemployed, provided that the institutional environment is more likely to restrain free-riding behavior. We also hypothesise that the personal observation of economic shocks, through affecting priors about neediness, increases the willingness to contribute, regardless of trust. We build a simple model to formalize what these joint hypotheses entail empirically, and test the theoretical predictions employing data from the Life in Transition II survey. We confirm that the effect of individual trust on supporting redistribution in favor of the poor and the unemployed increases with the quality of formal institutions. Trust and formal institutions, that is, are complements with respect to their effect on preferences for redistribution. Less trusting people are only inclined to contribute if they observe a high level of neediness in their direct environment, implying that perceived neediness and trust are substitutes in the preferences for redistribution. Results are robust to a series of robustness checks and placebo tests. To deal with endogeneity concerns we use historical prevalence of infectious disease and veto players as instruments for the quality of formal institutions and employ historical variability of the climate (Buggle and Durante, 2021) as an instrument for trust. The results are robust to this instrumentation strategy.