Identify which of the following statements is false.
A) The personal exemption for a trust provides a tax savings when some income is allocated to principal.
B) A complex trust must distribute all its income annually.
C) Distributable net income (DNI) sets the ceiling on the amount of distributions taxed to the beneficiaries.
D) The beneficiaries of a simple trust are taxed on their share of DNI irrespective of the amount they receive.
Correct Answer:
Verified
Q21: Explain to a client the significance of
Q28: Estates and trusts
A) receive a deduction for
Q29: A trust document does not define
Q30: A simple trust
A) may make charitable distributions.
B)
Q31: List some common examples of principal and
Q33: A trust distributes 30% of its income
Q35: A client asks about the relevance of
Q36: A complex trust permits accumulation of current
Q36: The exemption amount for an estate is
A)
Q37: Charitable contributions made by a fiduciary
A) flows
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