§ 35-6-505 — Income taxes

Tennessee § 35-6-505

• Jurisdiction: Tennessee
• Title: 35

Text

(a) A tax required to be paid by a trustee based on receipts allocated to income must be paid from income. (b) 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. (c) A tax required to be paid by a trustee on the trust's share of an entity's taxable income must be paid: (1) From income to the extent that receipts from the entity are allocated only to income; (2) From principal to the extent that receipts from the entity are allocated only to principal; (3) Proportionately from principal and income to the extent that receipts from the entity are allocated to both income and principal; and (4) From principal to the extent that the tax exceeds the total receipts from the entity. (d) After applying subsections (a)-(c), 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.

Legislative History

Acts 2000, ch. 829, § 1; 2010, ch. 725, § 2.