Question: David contributed $ 3 5 0 , 0 0 0 to a simple irrevocable trust and paid $ 1 1 , 0 0 0 of

David contributed $350,000 to a simple irrevocable trust and paid $11,000 of gift tax at the time of the transfer. David named his grandson, Hal, as the income beneficiary and his brother, Dale, as the remainder beneficiary. This year, the trust generated $16,000 of taxable dividend income and $2,500 of unrealized capital gains. What amount of taxable income will Hal include on his federal Form 1040 from this trust this year?
A) $0.
B) $2,500.
C) $11,000.
D) $16,000.

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