H.B. 873
GENERAL ASSEMBLY OF NORTH CAROLINA
Apr 25, 2023
SESSION 2023 HOUSE PRINCIPAL CLERK
H D
HOUSE BILL DRH30314-TMxf-1
Short Title: Modernize Income Tax of Trusts and Estates. (Public)
Sponsors: Representative Bradford.
Referred to:
1 A BILL TO BE ENTITLED
2 AN ACT TO MODERNIZE INCOME TAXATION OF TRUSTS AND ESTATES.
3 The General Assembly of North Carolina enacts:
4 SECTION 1. G.S. 105-160.2 reads as rewritten:
5 "§ 105-160.2. Imposition of tax.
6 (a) The Tax. – A tax is imposed by this Part applies to for each taxable year on the taxable
7 income of estates and trusts as determined under the provisions of the Code except as otherwise
8 provided in this Part. The taxable income of an estate or trust is the same as taxable income for
9 such an the estate or trust under the provisions of the Code, adjusted as provided in
10 G.S. 105-153.5 and G.S. 105-153.6, except that the adjustments provided in G.S. 105-153.5 and
11 G.S. 105-153.6 are apportioned between the estate or trust and the beneficiaries based on the
12 distributions made during the taxable year. The tax is at the rate levied in G.S. 105-153.7. The
13 fiduciary responsible for administering the estate or trust shall pay the tax.
14 (b) State-Sourced Income. – The tax is computed on the amount of the taxable income of
15 the estate or trust that is for the benefit of a resident of this State, or for the benefit of a nonresident
16 to the extent that the includes income that is:
17 (i) (1) is derived Derived from North Carolina sources and is attributable to the
18 ownership of any interest in real or tangible personal property in this State or
19 State.
20 (ii) (2) is derived Derived from a business, trade, profession, or occupation carried on
21 in this State. For purposes of the preceding sentence, taxable income and gross
22 income is computed subject to the adjustments provided in G.S. 105-153.5
23 and G.S. 105-153.6. The tax on the amount computed above is at the rate
24 levied in G.S. 105-153.7. The fiduciary responsible for administering the
25 estate or trust shall pay the tax computed under the provisions of this Part.
26 (c) Estates. – Except as provided in subsection (e) of this section, the taxable income of
27 an estate includes taxable income that is for the benefit of a resident of this State where any of
28 the following conditions exist:
29 (1) The decedent died a resident of this State.
30 (2) The resident of this State, including the estate of the resident of this State, is
31 certain to receive income or other benefit from the estate.
32 (d) Trusts. – The taxable income of a trust includes taxable income that is for the benefit
33 of a resident of this State where the trust is administered in this State.
34 (e) Long-Term Estates. – Estates remaining open for more than 50 years from the
35 decedent's date of death will be subject to tax under this section as a trust."
*DRH30314-TMxf-1*
 General Assembly Of North Carolina Session 2023
1 SECTION 2. This act is effective for taxable years beginning on or after January 1,
2 2023.
Page 2 DRH30314-TMxf-1


Statutes affected:
Filed: 105-160.2
Edition 1: 105-160.2