Distribution Coverage Analysis
Can portfolio income alone cover trust distributions — or do we need to sell?
Annual Gross Income
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Distribution + Taxes
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Coverage Ratio
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Equity Sales Required?
—
Annual Distribution Target:
or
Income vs. Distribution Waterfall
| Source | Notes | Annual Amount |
|---|---|---|
| PORTFOLIO INCOME — No Selling Required | ||
| Taxable Income | Per 2025 1099 summaries (dividends, MM interest, cap gains) | — |
| Tax-Exempt Municipal Income | MS muni bonds (per 2025 1099) | — |
| T-Bill Maturity Income | Loading... | — |
| Total Gross Income | — | |
| Less: Estimated Taxes | 37% on taxable income only (muni is tax-exempt) | — |
| Net Income After Tax | Cash available for distributions without selling | — |
| DISTRIBUTION REQUIREMENTS | ||
| Trust Distributions | $200K x 4 kids' trusts | — |
| Income Surplus / (Shortfall) | — | |
Sensitivity: What If We Distribute More?
| Distribution | Net Income | Surplus / (Shortfall) | Funding Source |
|---|
Portfolio Growth After Distributions
Annual Return vs. Outflow
Marketable Securities
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Projected Annual Return (6%)
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Less: Total Outflow (dist + taxes)
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Net Annual Growth
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Portfolio Growth Rate
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5-Year Projection (6% return)
Assumes constant 6% annual return and selected distribution level.
Actual returns will vary.
Liquidity Position & T-Bill Schedule
Current Liquid Assets
FIGXX (Fidelity MM)
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VUSXX (Vanguard Treasury MM)
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MS Muni Cash
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T-Bills (face value)
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Total Liquid
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Less: Opp Fund Dry Powder (FIGXX)
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MM Available for Distributions
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T-Bill Maturity Schedule
Equity Sales — Last Resort Only
Funding waterfall (in order):
(1) Portfolio income (dividends, interest, muni) covers distributions first.
(2) Redeem FIGXX/VUSXX — no capital gains, just cash out money market.
(3) T-Bills & muni cash as bridge liquidity.
(4) Only then: sell equities. Long-term gains only (20% vs 37%), lower gain % first.
Opp Fund dry powder: of FIGXX is allocated to the Opportunistic Fund for new investments (per Opp Fund workbook). Not available for distributions.
Opp Fund dry powder: of FIGXX is allocated to the Opportunistic Fund for new investments (per Opp Fund workbook). Not available for distributions.