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:

Hearing

The sense through which sound is perceived, involving the detection of vibrations and their interpretation by the brain.

Otitis Externa

An inflammation or infection of the external auditory canal, also known as swimmer's ear.

Acetic Acid Eardrops

A solution used in the treatment of outer ear infections that works by restoring the normal acidic environment of the ear canal.

Swab

A small piece of absorbent material on a stick or wire base, used to collect samples of substances from various parts of the body for testing or cleansing.