1- Fred creates a trust that is required to distribute all its income currently to his adult...
Question:
1- Fred creates a trust that is required to distribute all its income currently to his adult daughter Wilma. The trustee is authorized to also distribute principal to Wilma for her health and Support. No payments are provided for charity. Is the Trust a simple in a year when no principal payments are made to Wilma?
2- Megan is the sole beneficiary of a simple trust. In the most recently concluded calendar year (Year 1), the trust received $80,000 of fiduciary accounting income, all distributable to Megan. However, she received $20,000 in March, $20,000 in July, $20,000 in October and a final payment of $20,000 on January 20 of the following tax year (Year 2). How much income should Megan report on her income tax return for Year 1? How much income may the trust deduct for Year 1?
Federal Taxation 2016 Comprehensive
ISBN: 9780134104379
29th Edition
Authors: Thomas R. Pope, Timothy J. Rupert, Kenneth E. Anderson