The Gable Trust reports $20,000 business income and $10,000 exempt interest income,and it paid a $3,000 fiduciary fee.Gable's distributable net income includes $9,000 for the interest income.

Question

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The distributable net income includes all taxable income and certain adjustments, such as deductions for fiduciary fees. Therefore, Gable Trust's distributable net income would be $29,000 ($20,000 business income + $10,000 exempt interest income - $3,000 fiduciary fee) and $9,000 of it would be attributed to the exempt interest income.

The Gable Trust Reports $20,000 Business Income and $10,000 Exempt