§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).