An inter vivos trust earned $50,000 in eligible dividends. In addition, it received interest of $12,000 during the current year. The trust incurred accounting fees of $2,000 which were claimed by the trust. The trust has one beneficiary who is 23 years old and has no other source of income. During the current year, all of the dividends were distributed to the beneficiary and none of the interest. What is the Net Income For Tax Purposes of the beneficiary?

Question

Quizplus · Accepted Answer

The beneficiary's net income for tax purposes is $69,000. This is calculated by adding the eligible dividends of $50,000 to the interest of $12,000, and then subtracting the accounting fees of $2,000.

An Inter Vivos Trust Earned $50,000 in Eligible Dividends