19-3A-506
Section 19-3A-506 Adjustments between principal and income because of taxes. (a) A fiduciary may make adjustments between principal and income to offset the shifting of economic interests or tax benefits between income beneficiaries and remainder beneficiaries which arise from any of the following: (1) Elections and decisions, other than those described in subsection (b), that the fiduciary makes from time to time regarding tax matters; (2) An income tax or any other tax that is imposed upon the fiduciary or a beneficiary as a result of a transaction involving a decedent's estate, a trust, or a distribution from a decedent's estate or a trust; or (3) The ownership by a decedent's estate or trust of an interest in an entity whose taxable income, whether or not distributed, is includable in the taxable income of the decedent's estate, trust, or a beneficiary. (b) If the amount of an estate tax marital deduction or charitable contribution deduction is reduced because a fiduciary deducts...
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19-3A-201
Section 19-3A-201 Determination and distribution of net income. After the decedent's death, in the case of a decedent's estate, or after an income interest in a trust ends, the following rules apply: (a) If property is specifically given to a beneficiary by will or by trust, then the fiduciary of the decedent's estate or of the terminating income interest shall distribute the net income and net principal receipts to the beneficiary who is to receive the specifically given property, subject to the following rules: (1) The net income and principal receipts from the specifically given property are determined by including all of the amounts the fiduciary receives or pays with respect to the specifically given property, whether such amounts accrued or became due before, on, or after the date of the decedent's death or the date upon which an income interest in a trust terminates, and by making a reasonable provision for amounts that the fiduciary believes the decedent's estate or terminating...
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19-3A-104
Section 19-3A-104 Trustee's power to adjust. (a) If the terms of the trust expressly provide by specific reference to this section, then a trustee may have the power to adjust between principal and income to the extent the trustee considers necessary if (1) the trustee invests and manages trust assets as a prudent investor; (2) the terms of the trust describe the amount that may or must be distributed to a beneficiary by referring to the trust's income, and (3) the trustee determines, after applying the rules in Section 19-3A-103(a), that the trustee is unable to comply with Section 19-3A-103(b). (b) In deciding whether and to what extent to exercise the power conferred by subsection (a), a trustee shall consider all factors relevant to the trust and its beneficiaries, including, but not limited to: (1) The nature, purpose, and expected duration of the trust; (2) The intent of the settlor; (3) The identity and circumstances of the beneficiaries; (4) The needs for liquidity for the...
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19-3A-103
Section 19-3A-103 Fiduciary duties; general principles. (a) In allocating receipts and disbursements to or between principal and income, and with respect to any matter within the scope of Article 2 and Article 3, a fiduciary: (1) Shall administer a trust or decedent's estate in accordance with the terms of the trust or the will, even if there is a different provision in this chapter; (2) May administer a trust or decedent's estate by the exercise of a discretionary power of administration given to the fiduciary by the terms of the trust or the will, even if the exercise of the power produces a result different from a result required or permitted by this chapter; (3) Subject to the provisions of Section 19-3A-104, shall administer a trust or decedent's estate in accordance with this chapter if the terms of the trust or the will do not contain a different provision or do not give the fiduciary a discretionary power of administration; and (4) Shall add a receipt or charge a disbursement...
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40-18-25
Section 40-18-25 Estates and trusts. (a) For purposes of this chapter, the income and deductions, including the distribution deduction, of estates and trusts shall be determined in accordance with Subchapter J of Chapter 1 of Subtitle A of the Internal Revenue Code, 26 U.S.C. §641 et seq., relating to estates, trusts, beneficiaries, and decedents, except as otherwise provided in this section. (1) The income and deductions shall be increased by any items that are includable or deductible by an individual in computing Alabama income tax but are not includable or not deductible by an individual in computing federal income tax. (2) The income and deductions shall be decreased by any items that are not includable or not deductible by an individual in computing Alabama income tax but are includable or deductible by an individual in computing federal income tax. (b) For purposes of this chapter, the income and deductions of beneficiaries of estates and trusts, and persons who are treated as...
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19-3A-102
Section 19-3A-102 Definitions. As used in this chapter, the following terms are defined as follows: (1) ACCOUNTING PERIOD. A calendar year unless another 12-month period is selected by a fiduciary. The term includes a portion of a calendar year or other 12-month period that begins when an income interest begins or ends when an income interest ends. (2) BENEFICIARY. Includes, in the case of a decedent's estate, an heir, legatee, and devisee and, in the case of a trust, an income beneficiary and a remainder beneficiary. (3) FIDUCIARY. A personal representative or a trustee. The term includes an executor, administrator, successor personal representative, special administrator, and a person performing substantially the same function. (4) INCOME. Money or property that a fiduciary receives as current return from a principal asset. The term also includes a portion of receipts from a sale, exchange, or liquidation of a principal asset, to the extent provided in Article 4. (5) INCOME...
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19-3A-401
Section 19-3A-401 Character of receipts. (a) For purposes of this section, "entity" means a corporation, partnership, limited liability company, regulated investment company, real estate investment trust, common trust fund, or any other organization in which a fiduciary has an interest other than (1) a trust or decedent's estate to which Section 19-3A-402 applies, (2) a business or activity to which Section 19-3A-403 applies, or (3) an asset-backed security to which Section 19-3A-415 applies. (b) Except as otherwise provided in this section, a fiduciary shall allocate to income money received from an entity. (c) A fiduciary shall allocate the following receipts from an entity to principal: (1) Property other than money except in cases when the fiduciary has the choice to receive dividends or similar payments either in cash or in the shares or similar ownership interests of the corporation or other business entity, in which case, the fiduciary shall allocate the receipts to income; (2)...
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19-3D-2
Section 19-3D-2 THIS SECTION WAS ASSIGNED BY THE CODE COMMISSIONER IN THE 2018 REGULAR SESSION, EFFECTIVE JANUARY 1, 2019. THIS IS NOT IN THE CURRENT CODE SUPPLEMENT. DEFINITIONS. In this chapter the following terms have the following meanings: (1) APPOINTIVE PROPERTY. The property or property interest subject to a power of appointment. (2) ASCERTAINABLE STANDARD. A standard relating to an individual's health, education, support, or maintenance within the meaning of 26 U.S.C. Section 2041(b)(1)(A), as amended, or 26 U.S.C. Section 2514(c)(1), as amended, and any applicable regulations. (3) AUTHORIZED FIDUCIARY. (A) A trustee or other fiduciary, other than a settlor, that has the discretion to distribute or direct a trustee to distribute part or all of the principal of the first trust to one or more current beneficiaries; (B) a special fiduciary appointed under Section 19-3D-9; or (C) a special-needs fiduciary under Section 19-3D-13. (4) BENEFICIARY. A person that: (A) has a present or...
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19-3A-106
Section 19-3A-106 Conversion to unitrust. (a) Unless expressly prohibited by the governing instrument, a trustee may convert a trust into a unitrust as described in this section if all of the following apply: (1) The trustee has concluded that the conversion will enable the trustee to better carry out the intent of the settlor or testator and the purposes of the trust. (2) The trustee gives written notice of the trustee's intention to convert the trust into a unitrust, including the trustee's initial decisions as set forth below, to all the qualified beneficiaries. The written notice shall include the following: a. An explanation of how the unitrust will operate; b. The effective date of the conversion to a unitrust; c. The unitrust percentage to be used; d. The provisions for prorating a unitrust distribution for a short year in which a beneficiary's right to payments commences or ceases; e. Whether the net fair market value of the trust assets will be determined annually or averaged...
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40-18-1
Section 40-18-1 Definitions. For the purpose of this chapter, the following terms shall have the respective meanings ascribed by this section: (1) ADVANCED FOSSIL-BASED GENERATION. The production of electricity from fossil-based generation with the use of technology or efficiency improvements to control or reduce carbon emissions, including but not limited to, technologies described in 26 U.S.C. § 48A(f), as such provision existed on December 31, 2007. (2) ALTERNATIVE ENERGY RESOURCES. Coal gasification or liquefaction, nuclear, and advanced fossil-based generation. (3) BIOMASS. Animals and plants, and the waste, by-products, or derivatives of either, including, but not limited to, the materials described in 26 U.S.C. §§ 45(c)(2), 45(c)(3), 45K(c)(3), or 48B(c)(4). (4) BUSINESS TRUST. Any entity which is a business trust for federal income tax purposes. (5) CAPTIVE REIT. Any REIT whose shares or certificates of beneficial interest are not regularly traded on an established...
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