This year, the Nano Trust reported $50,000 entity accounting income and $40,000 distributable net income (DNI). Nano distributed $30,000 cash to Horatio, its sole income beneficiary. Nano is a complex trust. Nano's distribution deduction is:

Question

Quizplus · Accepted Answer

The distribution deduction for a complex trust is limited to the lesser of the distributable net income (DNI) or the actual distribution made. Here, the distribution deduction is $30,000, which is the amount actually distributed to the beneficiary.

This Year, the Nano Trust Reported $50,000 Entity Accounting Income