Determine Tax Payable for Trust under CANADIAN TAX LAW.
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Determine Tax Payable for Trust under CANADIAN TAX LAW.
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- A trust set up under the will of Encik Shiva who passed away in 2019. In the trust deed, three quarter of the trust income is to be distributed to Robert and Alberto (sons) and the balance is to be distributed to Kavita and Vanita (daughters) at the discretion of the trustee. The trustee is a Malaysian Resident. Infomation in respect of trust for the year assessment 2020: Adjusted business income 450,000 Capital Allowance 50,000 Gross rental income 38,000 Revenue expenses 12,000 Renovation cost 6,000 Dividend from Corona Bhd 13,000 Interest from Agrobank 40,000 Annuity to Jane (aunt) 72,000 Donation to approved institution 100,000 Distribution to Kavita 210,000 Distribution to Vanita 90,000 REQUIRED: calculate the chargeable income of trust body and the statutory income of each beneficiary for the year assessment 2020Facts The Flower Family Trust is a discretionary trust created by Graeme Flower (the trustee) in 2012 for the benefit of his children and grandchildren. During the year ended 30 June 2021 the Flower Family Trust has net income of $75,000. The trustee exercises his discretion to allocate $40,000 of the net income to Paula Flower who is 35 years of age and lives in a nursing home after suffering brain damage from a car accident four years ago. The balance of net income is not allocated to any beneficiary. Question Advise Graeme Flower of any tax obligations he has as trustee in respect of the net income of the trust for the year ended 30 June 2021.The Bell Family Trust (Bell Trust) was established by Mr. Bell for the purposes of the education and wellbeing of his family. In the last financial year Emma (aged 37) as Trustee made distributions from the trust account to herself, John (aged 20) and Edward (aged 17) under her discretion as trustee. Emma reports to you, her tax advisor, the following information: Distributions Emma $145,000 John $105,000 Edward $80,000 Retained in trust $10,000 Additional information: Emma works as a Social Media consultant and also had $150,000 in salary and $12,500 in work related expenses. John is a fulltime university student with no other income. Edward attends a private boarding school. $75,000 of his trust distribution pays his school fees. Explain the tax obligations for Emma, John, Edward and the undistributed income retained in the trust account?
- Mr. James Santiago created two (2) trusts designating Atty. Mars Bonafe and the Philippine Trust Company as trustees. The common beneficiary of the two (2) trusts was his son, James II, married, and with two (2) qualified dependent children. The following data were made available for the year 2019: Trust No.1 Trust No.2Gross income P 600,000 P 700,000Business expenses 300,000 400,000Income distribution to beneficiary 100,000 200,000 James Santiago IIGross income P 800,000Business expenses 250,000Income distribution received, gross of 15%creditable withholding…D creates a trust to last for 10 years, with income to D for the 10 year period and at the end of 10 years, remainder to X or X's estate. In Year 8 the trust is worth $ 5,000,000 and D's life estate is worth $ 2,000,000. In that year D sells his life estate to the trust for its $ 2,000,000 actuarial value and dies 2 years later. Assuming the trust had a value of $ 6,000,000 at D's death, the amount of trust property includible in D's gross estate, if any, is:Johnson transfers $500,000 of securities to an irrevocable trust, which is to pay him an income interest equal to five percent of the trust value determined each year for a term of 15 years. At the end of the 15-year term the remainder of the property shall pass to St. Philip's Hospital for Children. This is an example of what kind of trust? 1. A grantor retained income trust. 2. A charitable lead trust. 3. A charitable remainder unitrust. 4. A charitable remainder annuity trust. 01 02 03 04
- Mark for follow up Question 57 of 75. The Henry Addison Living Trust is a nongrantor trust with a single beneficiary, Alicia. This year, the trust had distributive income (DNI) of $13,000. After the allocation of deductions, this total includes the following amounts: Net rental income: $10,000. ● Tax-exempt interest: $3,000. Alicia's 2022 distribution was $5,000. How much of Alicia's distribution will be treated as tax-exempt interest? $1,154 $1,500 $3,000 $3,856 Mark for follow up ?nid=6d4c77ee-d986-42b2-b639-13fe1e66d5b5&evalLvl=5&redirect_url=%2fphBy the condition of a will, the sum of $ 2,000 is left to a girl to be held in trust fund by her guardian until it amounts to $ 5,000, when will the girl received the money if the fund is invested at 8% compounded quarterly? engineering econThe trustee of the Pieper Trust can distribute any amount of accounting income and corpus to the trust’s beneficiaries, Lydia and Avi. This year, the trust incurred the following. Taxable interest income $40,000Tax-exempt interest income 20,000Long-term capital gains—allocable to corpus 80,000 Legal and accounting fees—allocable to corpus 9,000 The trustee distributed $26,000 to Lydia and $13,000 to Avi. What is Pieper’s trust accounting income? What is Pieper’s DNI? What is Pieper’s taxable income? What amounts are taxed to each of the beneficiaries?
- The trustee of the Spratt Trust has the discretion to distribute the income or corpus of the trust in any proportion between the two beneficiaries of the trust, Edwin and Dolly. Under the trust instrument, Edwin must receive $20,000 from the trust every year. In the current year, the trust's accounting income is $100,000, and its DNI is $90,000. In addition to the required $20,000, the trustee pays Edwin $30,000 and Dolly $50,000. What amount income is recognized by the beneficiaries as the result of the distributions? Round any division to three decimal place and use in subsequent computations. If an amount is zero, enter "0". a. Edwin: First-tier Distribution of $fill in the blank 1 and Second-tier Distribution of $fill in the blank 2.b. Dolly: First-tier Distribution of $fill in the blank 3 and Second-tier Distribution of $fill in the blank 4This year Natalie transferred $500,000 of bonds to a revocable trust with directions to the trustee to pay income to her aunt for five years after which the corpus is to be distributed to Natalie's niece. At year end, the trustee paid $14,000 of income to the aunt. Which of the following is a true statement? Natalie has made a completed gift of $500,000. Natalie has made a taxable gift of $1,000. Natalie has not made a completed gift because the trust is revocable. O Natalie has made a taxable gift of $474,000. O None of these. Show Transcribed Text O the age of the life tenant. G The calculation of the value of a life estate in a trust generally does not depend upon which of the following factors? the Section 7520 interest rate. O the value of the property at the time of the transfer. the manner in which the trust corpus is invested. O All of these. (²The Remington Trust is a simple trust. Charlotte is its sole beneficiary. In the current year, the trust earns $56,000 in taxable interest and $13,000 in nontaxable interest. In addition, the trust recognizes an $8,000 long-term capital gain and $6,000 casualty loss. The trustee charges a fee of $15,000 for the year. b. However, if the trust agreement allocates one-third of the fiduciary's fees as well as all of the capital gains and losses to income, the trust accounting income is $
