The Kilp Sisters Trust is required to distribute $60,000 annually equally to its two income beneficiaries, Clare and Renee. If trust income is not sufficient to pay these amounts, the trustee can invade corpus to the extent necessary. During the current year, the trust generates only taxable interest income and records DNI of $160,000; the trustee distributes $30,000 to Clare and $150,000 to Renee.

a. How much of the $150,000 distributed to Renee is included in her gross income? $.
b. How much of the $30,000 distributed to Clare is included in her gross income? $ is included in her gross income.
c. The distributions which are composed of trust accounting income that is required to be distributed currently come under .

a)

Results for Renee are as follows:

After the first tier distributions ($60000/2 = $30000 to each income beneficiaries) are accounted for, $100000 DNI remains to be assigned to the beneficiaries on the second tier ($160000 DNI - $60000 DNI used for first tier distribution).

                 Amount received          DNI received = Gross income,

                                                                          portfolio income

First tier             $30,000.00                       $30,000.00                                                                            

Second tier     $1,20,000.00                        $ 1,00,000.00                                                                      

Total            $1,50,000.00                           $ 1,30,000.00                                                                      

b)

Results for Clare are as follows:

                          Amount received       DNI received = Gross income,

                                                                          portfolio income

First tier                $30,000.00                         $ 30,000.00                                                                      

Second tier            $ -                                              $ -                                                                                            

Total                 $30,000.00                           $ 30,000.00    

c)

The distributions which are composed of trust accounting income that is required to be distributed currently come under First Tier Distribution.                                              

b. a single paragraph.

a paragraph is a series of sentences that are organized and make sense, and are all related to a single topic . almost every piece of writing you do that is longer than a few sentences should be organized into paragraphs. this is because paragraphs show a reader where the subdivisions of an essay begin and end, and thus the reader see the organization of the essay into subjects in order to be able to understand its main points.