Prepare the 2021 fiduciary income tax return (Form 1041) for the Green Trust. 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 K-1 for Marcus White. The trust is not subject to the AMT. The year's activities of the trust include the following.

Dividend income, all qualified U.S. stocks	$10,000
Taxable interest income	50,000
Tax-exempt interest income	20,000
Net long-term capital gain, incurred 11/1	25,000
Trustee's fees	6,000

Under the terms of the trust instrument, cost recovery, net capital gains and losses, and fiduciary fees are allocable to corpus. The trustee is required to distribute $25,000 to Marcus every year. For the year, the trustee distributed $40,000 to Marcus and $40,000 to Marcus's sister, Ellen Hayes. No other distributions were made.

In computing DNI, the trustee properly assigned all of the deductible fiduciary's fees to the taxable interest income.

The trustee paid $4,000 in estimated taxes for the year on behalf of the trust. Any resulting refund is to be credited to the next tax year. The exempt income was not derived from private activity bonds.

The trust was created on December 14, 1993. It is not subject to any recapture taxes, nor can it claim any tax credits. None of its income was derived under a personal services contract. The trust has no economic interest in any foreign trust. Its Federal identification number is 11-1111122.

The trustee, Wisconsin State National Bank, is located at 3100 East Wisconsin Avenue, Milwaukee, WI 53201. Marcus lives at 9880 East North Avenue, Shorewood, WI 53211. His Social Security number is 123-45-6788. Ellen lives at 6772 East Oklahoma Avenue, Milwaukee, WI 53204. Her Social Security number is 987-65-4321.

1 Interest income. 2a Total ordinary dividends b Qualified dividends allocable to: (1) Beneficiaries (2) Estate or trust 3 Business income or (loss). Attach Schedule C (Form 1040) . . . . . . . . . . . . . . . 4 Capital gain or (loss). Attach Schedule D (Form 1041). 5 Rents, royalties, partnerships, other estates and trusts, etc. Attach Schedule E (Form 1040) ..... 9 Total income. Combine lines 1,2a, and 3 through 8 10 Interest. Check if Form 4952 is attached 11 Taxes 12 Fiduciary fees. If only a portion is deductible under section 67(e), see instructions . 14 Attorney, accountant, and return preparer fees. If only a portion is deductible under section 67(e), 15a Other deductions (attach schedule). See instructions for deductions allowable under section 67(e). Deduc- b Net operating loss deduction. See instructions tions 18 Income distribution deduction (from Schedule B, line 15). Attach Schedules K-1 (Form 1041) .... 19 Estate tax deduction including certain generation-skipping taxes (attach computation) . ...... 20 Qualified business income deduction. Attach Form 8995 or 8995A. 23 Taxable income. Subtract line 22 from line 17. If a loss, see instructions 25 Current year net 965 tax liability paid from Form 965-A, Part II, column (k) (see instructions) .... Tax and Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge. H - p U B AA For Paperwork Reduction Act Notice, see separate instructions. Form 1041 (2021) 5 Capital gains for the tax year included on Schedule A, line 1. See instructions 5 6 Enter any gain from page 1 , line 4 , as a negative number. If page 1 , line 4 , is a loss, enter the loss as a 6 7 Distributable net income. Combine lines 1 through 6 . If zero or less, enter 0. 7 74,000 8 If a complex trust, enter accounting income for the tax year as determined under the governing instrument and applicable local law ............. 9 Income required to be distributed currently 10 Other amounts paid, credited, or otherwise required to be distributed. 11 Total distributions. Add lines 9 and 10. If greater than line 8 , see instructions . \begin{tabular}{|l|l} \hline Schedule G & Tax Computation and Payments (see instructions) \\ \hline \end{tabular} Part I - Tax Computation 1 Tax: a Tax on taxable income. See instructions. b Tax on lump-sum distributions. Attach Form 4972. . . . . . c Alternative minimum tax (from Schedule I (Form 1041), line 54) ..1c d Total. Add lines 1a through 1c. 2a Foreign tax credit. Attach Form 1116 b General business credit. Attach Form 3800 C Credit for prior year minimum tax. Attach Form 8801. 3 Subtract line 2 e from line 1 d. If zero or less, enter 0 4 Tax on the ESBT portion of the trust (from ESBT Tax Worksheet, line 17). See instructions . 5 Net investment income tax from Form 8960 , line 21 6 Recapture taxes. Check if from: Form 4255 Form 8611 \begin{tabular}{|r|r} \hline 3 & 4,015 \\ \hline & \\ \hline 5 & \\ \hline 6 & \\ \hline \end{tabular} \begin{tabular}{ll|c|c} \hline \multicolumn{1}{|c|}{ Blue Trust 1041 (2021) } & \multicolumn{2}{l}{111111122} \\ \hline ther Information & & Yes & No \\ \hline 1 Did the estate or trust receive tax-exempt income? If "Yes," attach a computation of the allocation of expenses & & \\ \hline & Enter the amount of tax-exempt interest income and exempt-interest dividends. $ & \\ \hline & Did the estate or trust receive all or any part of the earnings (salary, wages, and other compensation) of any individual by & \end{tabular} AA For Paperwork Reduction Act Notice, see the Instructions for Form 1041. Schedule D (Form 1041) 2021 Note: If line 19, column (3), is a net gain, enter the gain on Form 1041, line 4 (or Schedule A (Form 990-T), Part I, line 4a). If lines 18a and 19, column (2), are net gains, go to Part V, and don't complete Part IV. If line 19, column (3), is a net loss, complete Part IV and the Capital Loss Carryover Worksheet, as necessary. sle D (Form 1041) 2021 Form 8960 1 Taxable interest (see instructions) .................................. 2 Ordinary dividends (see instructions) ............................... \begin{tabular}{|l|r|} \hline 1 & 50,000 \\ \hline 2 & 10,000 \\ \hline 3 & \\ \hline \end{tabular} 4a Rental real estate, royalties, partnerships, S corporations, trusts, etc. (see instructions)............................. b Adjustment for net income or loss derived in the ordinary course of a non-section 1411 trade or business (see instructions) ........ \begin{tabular}{|c|} 4a \\ \hline 4b \\ \hline \end{tabular} C Combine lines 4a and 4b. 5a Net gain or loss from disposition of property (see instructions) ... b Net gain or loss from disposition of property that is not subject to net investment income tax (see instructions) ................ C Adjustment from disposition of partnership interest or S corporation stock (see instructions) ..................... 6 Adjustments to investment income for certain CFCs and PFICs (see instructions) ............. 7 Other modifications to investment income (see instructions) ....................... \begin{tabular}{|c|c|} \hline 5d & 0 \\ \hline 6 & \\ \hline 7 & \\ \hline 8 & 0 \\ \hline \end{tabular} Part II Investment Expenses Allocable to Investment Income and Modifications 9a Investment interest expenses (see instructions) . ............ b State, local, and foreign income tax (see instructions) ......... c Miscellaneous investment expenses (see instructions) ......... 10 Additional modifications (see instructions) . .............................. Part III Tax Computation 12 Net investment income. Subtract Part II, line 11 , from Part If, line 8 . Individuals, complete lines 1317. Estates and trusts, complete lines 18a21. If zero or less, enter 0..... Individuals: Form 8960 c Miscellaneous investment expenses (see instructions). d Add lines 9a,9b, and 9c. 10 Additional modifications (see instructions) 11 Total deductions and modifications. Add lines 9d and 10 Part III Tax Computation 12 Net investment income. Subtract Part II, line 11, from Part I, line 8. Individuals, complete lines 13-17. Estates and trusts, complete lines 18 - 21. If zero or less, enter 0 Individuals: 13 Modified adjusted gross income (see instructions) 14 Threshold based on filing status (see instructions). 15 Subtract line 14 from line 13 . If zero or less, enter 0 \begin{tabular}{|l|l|} 13 & \\ \hline 14 & \\ \hline 15 & \\ \hline \end{tabular} 16 Enter the smaller of line 12 or line 15 17 Net investment income tax for individuals. Multiply line 16 by 3.8%(0.038). Enter here and include on your tax return (see instructions) Estates and Trusts: 18a Net investment income (line 12 above) b Deductions for distributions of net investment income and deductions under section 642 (c) (see instructions) ............ c Undistributed net investment income. Subtract line 18b from line 18a (see instructions). If zero or less, enter 0. 19a Adjusted gross income (see instructions) b Highest tax bracket for estates and trusts for the year (see instructions) c Subtract line 19b from line 19a. If zero or less, enter 0. 20 Enter the smaller of line 18c or line 19c 21 Net investment income tax for estates and trusts. Multiply line 20 by 3.8%(0.038). Enter here and include on your tax return (see instructions) BAA For Paperwork Reduction Act Notice, see your tax return instructions. Form 8960 (2021)