The Roz Trust has distributable net income (DNI)for the year of $100,000 and no income from tax-exempt sources.Under the terms of the trust instrument,the trustee must distribute $80,000 to Roger and $80,000 to Sally.After paying these amounts,the trustee is empowered to make additional distributions at its discretion.Exercising this authority,the trustee distributes an additional $20,000 to Roger and $20,000 to Sally.How much gross income from the trust must Roger recognize?

Question

Quizplus · Accepted Answer

Roger must recognize $50,000 as gross income from the trust, which includes the mandatory distribution of $40,000 (half of the $80,000) and half of the discretionary distribution of $10,000 (half of the $20,000).

The Roz Trust Has Distributable Net Income (DNI)for the Year