Since the lawyers are worthless, and you and the other CPAs are the keeper of the tax world, a client asks you to please explain what the term "distributable net income" means and its purpose, if any. In that discussion, you were determined to explain what its significance in connection with the income taxation of estates is, trusts and their beneficiaries. The client then asks: "What is the logic of using the lower of DNI or the actual distributions to the beneficiaries (in a complex trust) for the trust’s taxable income purposes"? And since you are at it, what are the most significant differences, if any, between a simple and complex trust?