The Tucker Trust was established six years ago. The trust is required to distribute all of the trust income at least annually to Betty for life. Capital gains are credited to principal. The current year results of the trust are as follows:
Amounts Allocable To
Income Principal
Dividends $15,000
Rental income from land 2,500
Tax-exempt interest 7,500
Rental expenses 500
Trustee fees $600
Tax return preparation fee 250
Capital gain on stock sale (stock purchased five years ago) 24,250 6,000
Distribution of net accounting income 1,300
Payment of estimated taxes
Compute (a) distributable net income (DNI), (b) the distribution deduction, (c) trust taxable income, and (d) Betty's reportable income and its classification. Charge all of the deductible expenses against rent income.

Question

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The Answer of The Tucker Trust was established six years ago. The trust is required to distribute all of the trust income at least annually to Betty for life. Capital gains are credited to principal. The current year results of the trust are as follows:
Amounts Allocable To
Income Principal
Dividends $15,000
Rental income from land 2,500
Tax-exempt interest 7,500
Rental expenses 500
Trustee fees $600
Tax return preparation fee 250
Capital gain on stock sale (stock purchased five years ago) 24,250 6,000
Distribution of net accounting income 1,300
Payment of estimated taxes
Compute (a) distributable net income (DNI), (b) the distribution deduction, (c) trust taxable income, and (d) Betty's reportable income and its classification. Charge all of the deductible expenses against rent income.

The Tucker Trust Was Established Six Years Ago