ote: This problem is for the 2020 tax year.

Prepare the 2020 fiduciary income tax return (Form 1041) for the Blue Trust. Complete the computational template for applying the five-step procedure and Form 1041 for the entity. In addition, determine the amount and character of the income and expense items that each beneficiary must report for the year, and prepare a Schedule K1 for Betty Blue. Omit all alternative minimum tax computations. The year's activities of the trust include the following.

Dividend income, all U.S. stocks	$50,000
Taxable interest income	10,000
Tax-exempt interest income	15,000
Trustee's fees	4,000

The trust and Betty both use the calendar tax year. Under the terms of the trust instrument, administrative fees are allocated to income. The trustee must distribute all of the entity's accounting income to Betty Blue by February 15 of the following year. The trustee followed this charge and made no other distributions during the year. Administrative fees were assigned properly as an offset to taxable interest income.

The trust was created on July 8, 2000. There are no tax credits for the year, and none of the entity's income was derived from a personal services contract. Blue has no economic interest in any foreign trust, and it is not subject to the AMT. Its Federal identification number is 11-1111121.

The trustee, Hoover State Federal Bank, is located at 49599 Cold Harbor Boulevard, Mountain Brook, AL 35223. Betty lives at 67671 Crestline Road, Birmingham, AL 35212. Her Social Security number is 123-45-6788.

Complete computational template for applying the five-step procedure to calculate the taxable income for the Blue Trust.

I JUST NEED THE ENTITY TAX INCOME OR LOSS its the last BOX.

Blue Trust

Note: Only steps 1-4 are required. If required, use the minus sign to indicate a loss.

Item	Totals	Accounting Income	Taxable Income	Distributable Net Income/Distribution Deduction
Dividend income	$fill in the blank ae1cfcfb4fe6056_1	$fill in the blank ae1cfcfb4fe6056_2	$fill in the blank ae1cfcfb4fe6056_3
Taxable interest income	fill in the blank ae1cfcfb4fe6056_4	fill in the blank ae1cfcfb4fe6056_5	fill in the blank ae1cfcfb4fe6056_6
Exempt interest income	fill in the blank ae1cfcfb4fe6056_7	fill in the blank ae1cfcfb4fe6056_8
Fiduciary fees	fill in the blank ae1cfcfb4fe6056_9	(fill in the blank ae1cfcfb4fe6056_10)	(fill in the blank ae1cfcfb4fe6056_11)
Personal exemption			(fill in the blank ae1cfcfb4fe6056_12)
Accounting income/Taxable income before the distribution deduction		$fill in the blank ae1cfcfb4fe6056_13	$fill in the blank ae1cfcfb4fe6056_14	$fill in the blank ae1cfcfb4fe6056_15
		STEP 1	STEP 2
Personal exemption				fill in the blank ae1cfcfb4fe6056_16
Net exempt income				fill in the blank ae1cfcfb4fe6056_17
Distributable net income			Taxable portion $fill in the blank ae1cfcfb4fe6056_18	$fill in the blank ae1cfcfb4fe6056_19
			fill in the blank ae1cfcfb4fe6056_20
			$fill in the blank ae1cfcfb4fe6056_21
Distribution deduction			(fill in the blank ae1cfcfb4fe6056_22) STEP 3	Lesser of $fill in the blank ae1cfcfb4fe6056_23distributed or $fill in the blank ae1cfcfb4fe6056_24taxable DNI distributed
Entity taxable income or loss			$fill in the blank ae1cfcfb4fe6056_25 STEP 4