The Allwardt Trust is a simple trust that correctly uses the calendar year for tax purposes. Its income beneficiaries (Lucy and Ethel) are entitled to the trust's annual accounting income in shares of one-half each. For the current tax year, Allwardt reports the following. Ordinary income $100,000 Long-term capital gains, allocable to income 30,000 Legal and accounting fees, allocable to corpus 5,000 The trust instrument allocates the capital gain to income. a. How much income is each beneficiary entitled to receive? b. What is the trust's DNI? c. What is the trust's taxable income/loss? The trust's ______ (taxable income/loss) is ____ d. How much gross income is reported by each of the beneficiaries?
The Allwardt Trust is a simple trust that correctly uses the calendar year for tax purposes. Its income beneficiaries (Lucy and Ethel) are entitled to the trust's annual accounting income in shares of one-half each.
For the current tax year, Allwardt reports the following.
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The trust instrument allocates the capital gain to income.
a. How much income is each beneficiary entitled to receive?
b. What is the trust's DNI?
c. What is the trust's taxable income/loss?
The trust's ______ (taxable income/loss) is ____
d. How much gross income is reported by each of the beneficiaries?
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