Income taxes

Checkout our iOS App for a better way to browser and research.

§7-465. Income taxes

1.  Tax based on receipts allocated to income.  A tax required to be paid by a trustee based on receipts allocated to income must be paid from income.  

[PL 2017, c. 402, Pt. A, §2 (NEW); PL 2019, c. 417, Pt. B, §14 (AFF).]

2.  Tax based on receipts allocated to principal.  A tax required to be paid by a trustee based on receipts allocated to principal must be paid from principal, even if the tax is called an income tax by the taxing authority.  

[PL 2017, c. 402, Pt. A, §2 (NEW); PL 2019, c. 417, Pt. B, §14 (AFF).]

3.  Tax on trust's share of entity's taxable income.  A tax required to be paid by a trustee on the trust's share of an entity's taxable income must be paid:  

A. From income to the extent that receipts from the entity are allocated only to income;   [PL 2017, c. 402, Pt. A, §2 (NEW); PL 2019, c. 417, Pt. B, §14 (AFF).]

B. From principal to the extent that receipts from the entity are allocated only to principal;   [PL 2017, c. 402, Pt. A, §2 (NEW); PL 2019, c. 417, Pt. B, §14 (AFF).]

C. Proportionately from principal and income to the extent that receipts from the entity are allocated to both income and principal; and   [PL 2017, c. 402, Pt. A, §2 (NEW); PL 2019, c. 417, Pt. B, §14 (AFF).]

D. From principal to the extent that the tax exceeds the total receipts from the entity.   [PL 2017, c. 402, Pt. A, §2 (NEW); PL 2019, c. 417, Pt. B, §14 (AFF).]

[PL 2017, c. 402, Pt. A, §2 (NEW); PL 2019, c. 417, Pt. B, §14 (AFF).]

4.  Adjustments because of deduction for payments to beneficiary.  After applying subsections 1 to 3, the trustee shall adjust income or principal receipts to the extent that the trust's taxes are reduced because the trust receives a deduction for payments made to a beneficiary.  

[PL 2017, c. 402, Pt. A, §2 (NEW); PL 2019, c. 417, Pt. B, §14 (AFF).]

SECTION HISTORY

PL 2017, c. 402, Pt. A, §2 (NEW). PL 2017, c. 402, Pt. F, §1 (AFF). PL 2019, c. 417, Pt. B, §14 (AFF).


Download our app to see the most-to-date content.