Maria, a single individual, created a revocable living trust in 2025. She transferred assets into the trust, including corporate bonds that generated $5,000 in interest and a rental property that produced $12,000 in net rental income. As the grantor, Maria retained the power to amend or revoke the trust at any time. How must the income generated by the trust's assets be reported for the 2025 tax year?

Maria must report the $5,000 of interest and $12,000 of rental income on her personal Form 1040.

The trust must file a Form 1041, U.S. Income Tax Return for Estates and Trusts, and pay tax on the $17,000 of income.

The income is not taxable to anyone until Maria revokes the trust or the assets are distributed to a beneficiary.

The trust must file an informational Form 1041, and the income is taxed directly to the named beneficiaries.

Maria must report the $5,000 of interest and $12,000 of rental income on her personal Form 1040.

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