in 2001 belinda barclay established barclay trust


In 2001, Belinda Barclay established Barclay Trust, an irrevocable trust, and named as trustee Local Bank, 1234 Main Street, Gouldsboro, PA 18424. She funded trust with corporate and municipal bonds. The trustee is directed to the distribute income and principle at it discretion to Belinda's adult son , Anthony Barclay (421-78-0443) and Patrick Barclay (421-78-0445), for 15 years and then to pay out remaining trust assets, adding any accumulated income, equally between the two sons. The Tax ID number for the trust is 74-543127. Half of trustee's fee is charged to principal and half to income. During the existing year, the trustee distributed $12,400 to Anthony, who resides at 31 Crimson COver, Tuscaloosa, AL 35487, and nothing to Patrick.

Other current year information for the trust is as given :

Corporate bond interest $17,000
Municipal bond interest 19,000
CPA's fee for prior year's tax return 800
Long term capital gain on sale of corporate bonds 2,200
Trustee's fee 1,500
Estimated federal income tax paid 3,700

The trustee has a $700 short term capital loss carryover starting prior year. Prepare a Form 1041, and any required Schedule K-1 for Barclay Trust. Ignore alternative minimum tax . The bond is not private activity bonds. Attach schedule to illustrate your calculation.

 

Solution Preview :

Prepared by a verified Expert
Financial Accounting: in 2001 belinda barclay established barclay trust
Reference No:- TGS0484122

Now Priced at $40 (50% Discount)

Recommended (90%)

Rated (4.3/5)