In the Current Year, a Trust Has Distributable Net Income

question 23

Multiple Choice

In the current year, a trust has distributable net income (DNI) of $30,000. During the year, the trust makes a mandatory distribution to Sarah of $5,000 and a discretionary distribution of $10,000 to Kyle. The trust has no tax- exempt income. The distribution deduction of the trust is

• A) $30,000.
• B) $15,000.
• C) $5,000.
• D) $10,000.

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Definitions:

Genetically Similar

Refers to organisms or entities that share a high degree of genetic material or DNA sequences with each other.

Germ Cells

The sperm and ova, which are specialized for sexual reproduction and have half the number of chromosomes normal for a species.

Somatic Cells

These are any cells forming an organism's body, excluding reproductive cells.

Meiosis

The process that produces sperm and ova, each of which contains only half of the parent cell’s original complement of 46 chromosomes.