Wayne created a trust six years ago for the benefit of his children. In the current year, when the value of the trust assets is $1,000,000,Wayne transfers additional property valued at $300,000 into the trust. Because Wayne is concerned that he might need some income in a future year if his investments do not perform well, he retains the right to receive the income from this latter property in any year in which his gross income falls below a specified amount.The trust received $100,000 in income this year: $30,000 from the newly transferred assets and $70,000 from the original assets.The entire $100,000 income is distributed directly to Wayne’s children before the end of the year.Who is taxed on the income?

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