# Enrolled Agent Exam [Part 2] 82, Distributable Net Income (DNI)

Page: https://stenobird.com/podcast/finance-exam-prep-7658413/enrolled-agent-exam-part-2-82-distributable-net-income-dni
Text version: https://stenobird.com/podcast/finance-exam-prep-7658413/enrolled-agent-exam-part-2-82-distributable-net-income-dni.md
Podcast: [Finance Exam Prep](https://stenobird.com/podcast/finance-exam-prep-7658413)
Published: 2026-07-18T22:41:20+00:00
Episode link: https://open-exam-prep.com/
Audio file: https://episodes.captivate.fm/episode/05780533-43a2-4da4-9286-edac356c7948.mp3
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Duration seconds: 222

## Resource

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams. In this episode you will learn: - That Distributable Net Income (DNI) acts as a ceiling for both the trust's distribution deduction and the beneficiary's reportable income. - Why capital gains allocated to the trust's principal (corpus) are the most common and critical exclusion from the DNI calculation on the EA exam. - How tax-exempt interest is included in the DNI calculation to ensure its tax-free character is retained when passed through to the beneficiary. - The function of the Tier System in complex trusts, which prioritizes mandatory (Tier 1) income distributions over discretionary (Tier 2) distributions when allocating DNI. - A simple mnemonic to avoid the most common exam trap: 'With DNI, you must deny the capital gain.' For more free exam prep tools, practice questions, and AI-powered explanations, visit https://open-exam-prep.com/ or YouTube Channel: https://www.youtube.com/@Open-exam-prep

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## Transcript

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