Trust Accounting Income?

[JoshinNC]

Working with a simple trust that is complex for 2006 (distributed some principal). TTB pg 21-9 states that in a year in which a trust is a complex trust the trust accounting income is reported on Sch. B line 8 & 9.

For 2006 this trust had taxable interest earnings of $342. Trust also distributed $44327 to pay off an equity line on a home in the trust and various costs associated with the sale of the home. My question is this - Is the trust's DNI the taxable interest income minus the distributions or is it the taxable interest only. Also, do I put the net of these numbers on line 8 & 9 of Sch. B or is line 8 the accounting income and line 9 the $342?

Thanks in advance!

[Gretel]

Not really an answer but maybe another step.

You mention the sale of the house but nothing about income associated with the sale. The accounting income depends greatly on the trust document and your state law.