A Trust Is Required to Distribute $60,000 Annually,split Equally Between

question 16

Essay

A trust is required to distribute $60,000 annually,split equally between its two income beneficiaries,Amber and Byron.If trust income is not sufficient to pay these amounts,the trustee can invade corpus to the extent necessary.During the current year,the trust has DNI of $20,000.Byron receives a $25,000 discretionary corpus distribution.
a.How much of the $30,000 distributed to Amber is included in her gross income?
b.How much of the $55,000 distributed to Byron is included in his gross income?
c.How much of these distributions are first-tier or second-tier?

---

Definitions:

ADHD-H

A subtype of Attention-Deficit/Hyperactivity Disorder predominantly characterized by hyperactivity and impulsivity.

ADHD-HI

Attention Deficit Hyperactivity Disorder, Hyperactive-Impulsive Type, characterized by excessive restlessness, impulsive behavior, and difficulty with maintaining attention.

Lifetime Prevalence

The percentage of people within a population who have encountered a certain disorder at least once in their lifetime until the time they are evaluated.

Substance Abuse

The misuse of legal or illegal substances such as drugs or alcohol that leads to significant impairment or distress.