Mont. Admin. r. 42.30.202 - TAX EXEMPT TRUSTS NOT CLASSIFIED AS CORPORATIONS
(1) If a trust is
held for educational, charitable, or religious purposes and is not classified
as a corporation under
15-31-101, MCA:
(a) Montana individual income tax is not
imposed on the fiduciary or the beneficiaries; and
(b) corporate income tax is imposed only on
the trust's unrelated business taxable income and must be paid by the fiduciary
as provided in (4).
(2)
Subject to (3), if a trust, that is not classified as a corporation under
15-31-101, MCA, is part of a
stock-bonus, pension, or profit-sharing plan for the exclusive benefit of some
or all of the employer's employees, and the employer and employee contributions
and earnings are accumulated by the trust in accordance with the plan for
distribution to the employees, then:
(a)
Montana individual income tax is not imposed on the fiduciary or beneficiaries
when the trust receives or accrues income;
(b) Montana individual income tax is imposed
on the amount of employer contributions and all trust earnings distributed or
made available to the distributee in the year distributed; and
(c) corporate income tax is imposed on the
trust's unrelated business taxable income and must be paid by the fiduciary as
provided in (3).
(3) An
otherwise tax-exempt trust that has unrelated business taxable income (UBTI),
as determined for federal income tax purposes, is subject to Montana corporate
income tax and is required to file a Montana corporate income tax return
reporting that income if the trust's federal UBTI tax liability for the tax
year exceeds $100. To the extent the trust's UBTI is Montana source income, the
trust is treated as having been engaged in business in Montana within the
meaning of
15-31-101, MCA.
Notes
AUTH: 15-1-201, 15-30-2104, MCA; IMP: 15-30-2151, 15-30-2152, 15-30-2153, 15-31-101, 15-31-102 MCA
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