A simple trust has the following receipts and expenditures for the current year. The trust instrument is silent with respect to the capital gains, and state law concerning trust accounting income follows the Uniform Act. Assume the trustee’s fee is charged equally to principal and income. Corporate bond interest $40,000 Tax-exempt interest 9,000 Long-term capital gain 5,000 Trustee’s fee 2,000 Distribution to beneficiary 48,000 What is the trust’s taxable income? What is the trust’s tax liability?
A simple trust has the following receipts and expenditures for the current year. The trust instrument is silent with respect to the capital gains, and state law concerning trust accounting income follows the Uniform Act. Assume the trustee’s fee is charged equally to principal and income. Corporate bond interest $40,000 Tax-exempt interest 9,000 Long-term capital gain 5,000 Trustee’s fee 2,000 Distribution to beneficiary 48,000 What is the trust’s taxable income? What is the trust’s tax liability?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A simple trust has the following receipts and expenditures for the current year. The trust instrument is silent with respect to the
|
Corporate bond interest |
$40,000 |
|
Tax-exempt interest |
9,000 |
|
Long-term capital gain |
5,000 |
|
Trustee’s fee |
2,000 |
|
Distribution to beneficiary |
48,000 |
- What is the trust’s taxable income?
- What is the trust’s tax liability?
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