Question
Phil, the grantor, set up two irrevocable trusts: Trust K and Trust J. The income of Trust K is to be accumulated for distribution to
Phil, the grantor, set up two irrevocable trusts: Trust K and Trust J. The income of Trust K is to be accumulated for distribution to Phil's spouse after Phil's death. The income of Trust J is to be accumulated for Phil's children, whom Phil is legally obligated to support, and the trustee has the discretion to use any part of the income for the children's support. Half of the income was so used in this year. Based on this information, which of the following statements is true?
-All the income from both trusts is taxed to Phil.
-None of the income from either trust is taxed to Phil.
-No income from Trust K is taxed to Phil, and half of the income from Trust J is taxed to Phil.
-All the income from Trust K and half from Trust J are taxed to Phil.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started