A Trust Has Net Accounting Income and Distributable Net Income

question 99

Multiple Choice

A trust has net accounting income and distributable net income (DNI) of $60,000, all from taxable sources. The trustee is required to distribute $40,000 of current income to Harry. In addition, the trustee makes a discretionary distribution to Harry of $10,000 and a discretionary distribution to Susan of $30,000. $20,000 of the $40,000 total discretionary distributions is from corpus. Gross income reportable by Harry is

• A)$50,000.
• B)$45,000.
• C)$37,500.
• D)$30,000.

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Definitions:

Whelks

Marine gastropod mollusks, often found in cold seas, characterized by their spiral shells and carnivorous habits.

Handling Time

The duration of time an organism spends processing its captured food before consuming it.

Crows

Members of the genus Corvus, characterized by their strong social behavior, adaptability, and intelligence, including their ability to use tools and recognize human faces.

Adaptive Foraging Strategy

Behavior modification by an organism to increase its survival or reproductive success when finding food.