gifts qualify for exemption under Code Sec 663a and distributions of them to

Gifts qualify for exemption under code sec 663a and

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gifts qualify for exemption under Code Sec. 663(a), and distributions of them to Donna may carry out DNI. A tax return for the calendar year 2009 must be fi led on or before April 15, 2010, and the tax return for the 56. fractional part of 2010, that is, January 1 to March 28, 2010, must be fi led on or before April 15, 2011. $15,000 is the trust’s charitable deduction for 2010 ($20,000 - $20,000/$80,000 × $20,000). 57. a. The trust accounting income is $20,000 because the $5,000 payment does not reduce the accounting 58. income. b. $15,000 is taxable to the bene fi ciaries because the trustee’s commission affects DNI and not trust accounting income as these expenses were allocated to corpus. c. The trust will pay tax on $9,700—that is, the retained capital gain of $10,000 minus the $300 exemption. Evelyn reports the $100,000 in the year in which the estate’s year ends within her year. As a result, Evelyn 59. reports the $100,000 on her tax return for 2010 that is fi led by April 15, 2011. Thus, Evelyn has enjoyed a nice 11-month deferral because of the estate’s January year-end. a. The bene fi ciary’s income is $100,000; the estate’s distribution deduction is $100,000; and the 60. bene fi ciary’s basis is $100,000 in the property. b. The bene fi ciary’s income is $300,000; the estate’s distribution deduction is $300,000; and the bene fi ciary’s basis is $300,000 in the property. c. In (a), there is zero gain; in (b), $200,000 gain.
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722 CCH Federal Taxation—Basic Principles Chapter 18 © 2010 CCH. All Rights Reserved. DIFFICULTY LEVEL RATINGS—CHAPTER 18 The following table denotes the relative dif fi culty level of each question. Teachers may wish to organize test questions based on the dif fi culty level of the particular class. True-False Question Ratings Easy 1. Easy 2. Easy 3. Easy 4. Easy 5. Easy 6. Easy 7. Easy 8. Easy 9. Easy 10. Easy 11. Easy 12. Easy 13. Easy 14. Moderate 15. Moderate 16. Moderate 17. Moderate 18. Dif fi cult 19. Moderate 20. Moderate 21. Moderate 22. Moderate 23. Moderate 24. Moderate 25. Multiple Choice Question Ratings Easy 26. Moderate 27. Moderate 28. Moderate 29. Moderate 30. Moderate 31. Moderate 32. Dif fi cult 33. Moderate 34. Moderate 35. Moderate 36. Easy 37. Moderate 38. Moderate 39. Moderate 40. Dif fi cult 41. Moderate 42. Moderate 43. Moderate 44. Dif fi cult 45. Moderate 46. Moderate 47. Moderate 48. Moderate 49. Moderate 50. Supplementary Problem Ratings Dif fi cult 51. Dif fi cult 52. Moderate 53. Dif fi cult 54. Moderate 55. Easy 56. Moderate 57. Moderate 58. Moderate 59. Dif fi cult 60.
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