Apple Trust Reports Net Accounting Income of $40,000, All from Taxable

question 1

Multiple Choice

Apple Trust reports net accounting income of $40,000, all from taxable sources. The trustee is required to distribute $15,000 annually to Megan. The trustee also makes discretionary distributions of $30,000, $7,500 to Megan and $22,500 to Caroline. The trust pays $5,000 of the discretionary distributions from corpus. What is the amount of the distribution deduction?

• A)$40,000
• B)$45,000
• C)$15,000
• D)$30,000

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Definitions:

Motives

The underlying reasons or goals that drive individuals to act or make decisions in a particular way.

Intentions

The plans or desires one has in mind to execute or achieve a specific outcome.

Decision Maker

An individual or group responsible for making choices after considering various options and their potential outcomes.

Blurry Boundaries

Undefined or unclear lines of demarcation between different roles, responsibilities, or concepts.