NORTH CAROLINA GENERAL ASSEMBLY

1969 SESSION

CHAPTER 1114

SENATE BILL 356

AN ACT TO AMEND G.S. 105-204 PROVIDING A CREDIT TO RESIDENT BENEFICIARIES OF FOREIGN TRUSTS FOR FOREIGN INTANGIBLES TAXES PAID.

The General Assembly of North Carolina do enact:

Section 1.  G.S. 105-204 is hereby amended by rewriting the same to read as follows:

"G.S. 105-204.  Beneficial interest in foreign trusts. The beneficial or equitable interest on December thirty-first of each year of any resident of this State, or of a nonresident having a business, commercial or taxable situs in this State, in any trust, trust fund or trust account (including custodian accounts) held by a foreign fiduciary, shall be subject to an annual tax, which is hereby levied, of twenty-five cents (25ȼ) on every one hundred dollars ($100.00) of the total actual value thereof less, however, the proportion of such value as is equal to the proportion of the beneficiary's income from the trust, trust fund, or trust account (including custodian accounts) that is attributable to (i) interest received by the fiduciary on bonds, notes or other evidences of debt of the United States, State of North Carolina, subdivisions of this State, or agencies of such governmental units and (ii) dividends received by the fiduciary on shares of stock which, or to the extent that the same, are deductible by the beneficiary in computing his income tax liability under the provisions of subdivision (7) of G.S. 105-147; provided, however, that a resident beneficiary of a foreign trust shall be allowed a credit against any tax due under this Section for any foreign intangibles tax paid on his beneficial interest in a foreign trust.

The value of the corpus of such trust, trust fund or trust account shall not be considered in computing taxable value hereunder, unless the person subject to the tax:

(1)        Has the right to the present possession of an interest therein, and then only to the extent of the value of such present interest; or

(2)        Has the present right to receive a part or all of the income realized from the corpus of such trust, and then only to the extent of the present value of such income interest; or

(3)        Has created the trust and reserved for himself an income reversionary or remainder interest therein, and then only to the extent of the present value of such interest."

Sec. 2.  All laws and clauses of laws in conflict with this Act are hereby repealed.

Sec. 3.  This Act shall be effective from and after July 1, 1969.

In the General Assembly read three times and ratified, this the 30th day of June, 1969.