Net investment income
and core net investment income
decreased in the quarter ended December 31, 2016, as compared to the quarter ended December 31, 2015, primarily as a result of less non-recurring income related to the acceleration of interest income in conjunction with the payoff of loans in the quarter ended December 31, 2016, as compared to the quarter ended December 31, 2015.
In simple terms, undistributed net investment income
is any net investment income
--as defined by Code section 1411(c)(1)(A)--that is retained by a trust or an estate.
The net investment income
tax applies to trusts and estates for tax years beginning after Dec.
But if the $50,000 is invested in growth stocks that pay only $500 in dividends, current deductions are limited to the net investment income
of $500; the remaining interest expense of $4,500 must be carried forward indefinitely.
net investment income
receipts remained positive last year.
Only individuals with MAGI above the thresholds and certain estates and trusts are subject to the net investment income
As such, it is not earned in the ordinary course of a trade or business and, thus, regardless of the other exceptions, is subject to the net investment income
If Doris had $2,000 investment income, imputed interest would be computed, but would be limited to her $2,000 net investment income
4940(c)(1), which states that "[e]xcept to the extent inconsistent with the provisions of this section, net investment income
shall be determined under the principles of Subtitle A.
However, if estimated net investment income
for the year is expected to increase (e.
Interest expense incurred by noncorporate taxpayers that is allocable to property held for investment ("investment interest expense") is generally allowed as a deduction only to the extent of that taxpayer's net investment income