Which of the following is a true statement concerning net operating losses (NOLs) of trusts and estates?
A. NOLs are not deductible by either trusts or estates.
B. NOLs are deductible by trusts, but not by estates.
C. NOLs of trusts and estates are deductible each year by the beneficiaries.
D. NOL carryovers of trusts and estates are passed through to the beneficiaries in the last year of the estate or trust.
Answer: D. NOL carryovers of trusts and estates are passed through to the beneficiaries in the last year of the estate or trust.
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