Jim created a trust that holds the deeds to two rental properties. His two children will receive all income from the trust while Jim is alive and will continue to receive this income after Jim's death. A separate trustee receives all rental payments and is responsible for making any required payments for the two properties. The trust receives $100,000 in rent payments and $1,000 in interest held in an account used for required payments. The trust paid $10,000 in mortgage interest and $15,000 in property taxes during the year. Which item (s) will be reported on Jim's Form 1040 and which will be reported on the trust's Form 1041?
a. Jim will take the deductions for mortgage interest ($10,000) and property taxes ($15,000) on his Form 1040.
b. All items indicated will be reported on the trust's Form 1041.
c. The trust will report everything except the $1,000 of interest on its Form 1041.
d. The interest of $1,000 will be reported on Jim's Form 1040.