2011 Kentucky Revised Statutes CHAPTER 386 ADMINISTRATION OF TRUSTS -- LEGAL INVESTMENTS -- UNIFORM PRINCIPAL AND INCOME ACT 386.466 "Entity" defined -- Character of receipts from entities.
KY Rev Stat § 386.466 (1996 through Reg Sess) What's This?
386.466 "Entity" defined -- Character of receipts from entities.
(1)
(2)
(3)
(4)
(5)
(6)
In this section, "entity" means a corporation, partnership, limited partnership,
limited liability company, statutory or business trust, regulated investment
company, real estate investment trust, common trust fund, or any other organization
in which a trustee has an interest other than a trust or estate to which KRS 386.468
applies.
Except as otherwise provided in this section, a trustee shall allocate to income
money received from an entity.
A trustee shall allocate the following receipts from an entity to principal:
(a) Property other than money;
(b) Money received in one (1) distribution or a series of related distributions in
exchange for part or all of a trust's interest in the entity;
(c) Money received in total or partial liquidation of the entity; and
(d) Money received from an entity that is a regulated investment company or a
real estate investment trust, if the money distributed is a capital gain dividend
for federal income tax purposes.
Money is received in partial liquidation:
(a) To the extent that the entity, at or near the time of a distribution, indicates that
it is a distribution in partial liquidation; or
(b) If the total amount of money and property received in a distribution or series
of related distributions is greater than twenty percent (20%) of the entity's
gross assets, as shown by the entity's year end financial statements
immediately preceding the initial receipt.
Money is not received in partial liquidation, nor may it be taken into account under
paragraph (b) of subsection (4) of this section to the extent that it does not exceed
the amount of income tax that a trustee or beneficiary shall pay on taxable income
of the entity that distributes the money.
A trustee may rely upon a statement made by an entity about the source or character
of a distribution if the statement is made at or near the time of distribution by the
entity's board of directors or other person or group of persons authorized to exercise
powers to pay money or transfer property comparable to those of a corporation's
board of directors.
Effective: July 15, 2010
History: Amended 2010 Ky. Acts ch. 133, sec. 76, effective July 15, 2010. -- Created
2004 Ky. Acts ch. 158, sec. 9, effective January 1, 2005.
Legislative Research Commission Note (9/9/2008). The Reviser of Statutes has
corrected a manifest clerical or typographical error in subsection (5) of this statute
under the authority of KRS 7.136(1)(h) by supplying the inadvertently omitted word
"tax" following "the amount of income" to conform with the adopted text of the
Uniform Principal and Income Act.
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