Distributable Net Income (DNI) a. will vary depending on the number of estate/trust beneficiaries. applies to estates but not trusts.

26.    Distributable Net Income (DNI)

a.        will vary depending on the number of estate/trust beneficiaries.

b.       applies to estates but not trusts.

c.        as a general rule does not include capital gains.

d.       does not limit the amount that can be taxed to the estate/trust beneficiaries

27.     The net operating loss deduction

a.        cannot exceed 20% of the estate's or trusts DNI.

b.       pass through can be used by a beneficiary regardless of the beneficiary's itemization of deductions.

c.        is deductible only on an estate's federal estate tax return.

d.       is unavailable to estates and trusts.

28.     Investment advisory fees paid by an estate or trust

a.        are subject to the 4% reduction required by section 67 IRC.

b.       are fully tax deductible to the extent listed without objection on a trust accounting.

c.        are fully tax deductible.

d.       none of the above is correct.

29.     Tax free income is

a.        excluded from the computation of DNI for trusts but not estates.

b.       included in the computation of DNI for complex trusts but not simple trusts.

c.        subject to reduction for pro-rata share of expenses.

d.       excluded from the computation of DNI.

35.     The separate share rule

a.        is limited to simple trusts.

b.       applies to estates but not trusts.

c.        applies to trusts but not estates.

d.       applies to estates and trusts.