Allocate DNI to the beneficiary

South-Western Federal Taxation 2019 Comprehensive 42nd Edition (2).pdf - Adobe Acrobat Reader DC File Edit View Window Help Home Tools South-Western Fed... * Sign In A 1302 / 1421 A M 63% - 7 eur 26 Share EXAMPLE The Pork Trust is required to distribute its current accounting income annually to its sole income beneficiary, Barbara, Capital gains and losses and all other expenses are allocable to corpus. In the current year, Pork incurs the following items. the pork trust Dividend income Taxable interest income Tax-exempt interest income Net long-term capital gain Fiduciary fees $25,000 15,000 20,000 10,000 6,000 Distributable Net Income! Distribution Deduction Accounting Income Taxable Income Item Totals $25,000 15,000 20,000 $ 25,000 15,000 Dividend income Taxable interest income Tax-exempt interest income Net long-term capital gain Fiduciary fees Personal exemption Accounting income/taxable income before the distribution deduction $25,000 15,000 20,000 10,000 6,000 10,000 (4,000) (300) $60,000 $ 45,700 $ 45,700 Step 1 Step 2 Personal exemption Corpus capital gain/loss Net tax-exempt income Distributable net income Distribution deduction Entity taxable income 300 (10,000) 18,000 $ 54,000 Convert and edit PDFs with Acrobat Pro DC Start Free Trial Step 3 Step 4 (36,000) $ 9,700 3:46 PM 12/9/2019 South-Western Federal Taxation 2019 Comprehensive 42nd Edition (2).pdf - Adobe Acrobat Reader DC File Edit View Window Help Home Tools South-Western Fed... * Sign In A 1302 / 1421 A M 63% - 7 eur 26 Share EXAMPLE The Pork Trust is required to distribute its current accounting income annually to its sole income beneficiary, Barbara, Capital gains and losses and all other expenses are allocable to corpus. In the current year, Pork incurs the following items. the pork trust Dividend income Taxable interest income Tax-exempt interest income Net long-term capital gain Fiduciary fees $25,000 15,000 20,000 10,000 6,000 Distributable Net Income! Distribution Deduction Accounting Income Taxable Income Item Totals $25,000 15,000 20,000 $ 25,000 15,000 Dividend income Taxable interest income Tax-exempt interest income Net long-term capital gain Fiduciary fees Personal exemption Accounting income/taxable income before the distribution deduction $25,000 15,000 20,000 10,000 6,000 10,000 (4,000) (300) $60,000 $ 45,700 $ 45,700 Step 1 Step 2 Personal exemption Corpus capital gain/loss Net tax-exempt income Distributable net income Distribution deduction Entity taxable income 300 (10,000) 18,000 $ 54,000 Convert and edit PDFs with Acrobat Pro DC Start Free Trial Step 3 Step 4 (36,000) $ 9,700 3:46 PM 12/9/2019