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

question 4

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 taxable amount of the Megan's tier-2 distribution?

• A)$7,500
• B)$6,250
• C)$15,000
• D)$22,500

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Definitions:

Historical Forces

Factors and events from the past that have a significant impact on the present and future course of society.

Family Structure

The composition and organization of a household, including the relationships and roles of its members.

Sect

Group that has broken off from an established church.

Church

A formal organization that sees itself and is seen by society as a primary and legitimate religious institution.