Allocation of Income Attributable to Nonresidents
If the estate or trust has income from sources outside
of North Carolina and if any of the beneficiaries are nonresidents
of North Carolina, the portion of federal taxable income of the
fiduciary that is subject to North Carolina tax must be determined.
If there is no gross income from dividends, interest, other intangibles
or from sources outside North Carolina for the benefit of a nonresident
beneficiary, the total income of the estate or trust is taxable
to the fiduciary.
The determination of the amount of undistributed income from intangible property which is for the benefit of a resident is based on the beneficiary's state of residence on the last day of the taxable year of the trust. In the case of both resident and nonresident beneficiaries, the determination of the amount of undistributed income from intangible property which is for the benefit of a resident is made on the basis that the resident beneficiary's interest for the taxable year relates to the interest of both resident and nonresident income beneficiaries for the taxable year.
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