What does distributable net income mean on the CPA exam?
Distributable net income. The ceiling on what a trust or estate may deduct for distributions and on what the beneficiary must report. It also fixes the character of what the beneficiary receives.
Defined against Sec. 643(a).
Which CPA exam sections use distributable net income?
Distributable net income appears in the TCP section of the CPA exam.
Other names for distributable net income
DNI
Related terms
- capital gain net income: Capital gains minus capital losses for the year, long-term and short-term combined.
- earned income: Compensation for personal services -- wages, or net earnings from self-employment.
- gross income: All income from whatever source derived, unless the Code specifically excludes it.
- interest income: What a lender earns for the use of its money over time, recognized as it is earned.
- net income: What is left after every revenue and expense of the period, including tax and discontinued operations.
- net investment income: Interest, dividends, capital gains, rents, royalties and income from passive businesses, less the deductions allocable to them.