Montana Code Annotated 2019



Part 21. Rate and General Provisions

Tax On Beneficiaries Or Fiduciaries Of Estates Or Trusts

15-30-2151. Tax on beneficiaries or fiduciaries of estates or trusts. (1) A tax must be imposed upon either the fiduciaries or the beneficiaries of estates and trusts as provided in this section, except to the extent that estates and trusts must be held for educational, charitable, or religious purposes. The tax must be levied, collected, and paid annually with respect to the income of estates or of any kind of property held in trust, including:

(a) income received by estates of deceased persons during the period of administration or settlement of the estate;

(b) income accumulated in trust for the benefit of unborn or unascertained persons or persons with contingent interests;

(c) income held for future distribution under the terms of the will or trust; and

(d) income that is to be distributed to the beneficiaries periodically, whether or not at regular intervals, and the income collected by a guardian of a minor, to be held or distributed as the court may direct.

(2) The fiduciary is responsible for making the return of income for the estate or trust for which the fiduciary acts, whether the fiduciary or the beneficiaries are taxable with reference to the income of the estate or trust. In cases under subsections (1)(a) and (1)(d), the fiduciary shall include in the return a statement of each beneficiary's distributive share of net income, whether or not distributed before the close of the tax year for which the return is made.

(3) In cases under subsections (1)(a), (1)(b), and (1)(c), the tax must be imposed upon the fiduciary of the estate or trust with respect to the net income of the estate or trust and must be paid by the fiduciary. If the taxpayer's net income for the tax year of the estate or trust is computed upon the basis of a period different from that upon the basis of which the net income of the estate or trust is computed, then the taxpayer's distributive share of the net income of the estate or trust for any accounting period of the estate or trust ending within the fiscal or calendar year must be computed upon the basis on which the beneficiary's net income is computed. In those cases, a beneficiary who is not a resident must be taxable with respect to the beneficiary's income derived through the estate or trust only to the extent provided in 15-30-2111 for individuals other than residents.

(4) The fiduciary of a trust created by an employer as a part of a stock bonus, pension, or profit-sharing plan for the exclusive benefit of some or all of the employer's employees, to which contributions are made by the employer or employees, or both, for the purpose of distributing to the employees the earnings and principal of the fund accumulated by the trust in accordance with the plan, are not taxable under this section, but any amount contributed to the fund by the employer and all earnings of the fund must be included in computing the income of the distributee in the year in which distributed or made available to the distributee.

(5) Where any part of the income of a trust other than a testamentary trust is or may be applied to the payment of premiums upon policies of insurance on the life of the grantor, except policies of insurance irrevocably payable for the purposes and in the manner specified relating to the so-called "charitable contribution" deduction, or to the payment of premiums upon policies of life insurance under which the grantor is the beneficiary, the part of the income of the trust must be included in computing the net income of the grantor.

History: En. Sec. 12, Ch. 181, L. 1933; re-en. Sec. 2295.12, R.C.M. 1935; amd. Sec. 6, Ch. 260, L. 1955; R.C.M. 1947, 84-4912; amd. Sec. 1, Ch. 2, L. 1983; amd. Sec. 1, Ch. 260, L. 1983; amd. Sec. 164, Ch. 56, L. 2009; Sec. 15-30-135, MCA 2007; redes. 15-30-2151 by Sec. 1, Ch. 147, L. 2009.