(A) Application of Tax. - The tax imposed by this Title upon individuals shall apply to the income of estates or of any kind of property held in trust, including:
(A) There shall be allowed as a deduction in computing the taxable income of the estate or trust the amount of the income of the estate or trust for the taxable year which is to be distributed currently by the fiduciary to the beneficiaries, and the amount of the income collected by a guardian of an infant which is to be held or distributed as the court may direct, but the amount so allowed as a deduction shall be included in computing the taxable income of the beneficiaries, whether distributed to them or not. Any amount allowed as a deduction under this Subsection shall not be allowed as a deduction under Subsection (B) of this Section in the same or any succeeding taxable year.
(B) In the case of income received by estates of deceased persons during the period of administration or settlement of the estate, and in the case of income which, in the discretion of the fiduciary, may be either distributed to the beneficiary or accumulated, there shall be allowed as an additional deduction in computing the taxable income of the estate or trust the amount of the income of the estate or trust for its taxable year, which is properly paid or credited during such year to any legatee, heir or beneficiary but the amount so allowed as a deduction shall be included in computing the taxable income of the legatee, heir or beneficiary.
(C) In the case of a trust administered in a foreign country, the deductions mentioned in Subsections (A) and (B) of this Section shall not be allowed: Provided, That the amount of any income included in the return of said trust shall not be included in computing the income of the beneficiaries.
SEC.
62. Exemption Allowed to Estates and Trusts.
- For the purpose of the tax provided for in this Title, there shall be
allowed an exemption of Twenty thousand pesos (P20,000) from the income
of the estate or trust.
SEC.
63. Revocable Trusts.
- Where at any time the power to revest in the grantor title to any part
of the corpus of the trust is vested (1) in the grantor either alone or
in conjunction with any person not having a substantial adverse interest
in the disposition of such part of the corpus or the income therefrom,
or (2) in any person not having a substantial adverse interest in the disposition
of such part of the corpus or the income therefrom, the income of such
part of the trust shall be included in computing the taxable income of
the grantor.
SEC.
64. Income for Benefit of Grantor.-
(A) Where any part of the income of a trust (1) is, or in the discretion of the grantor or of any person not having a substantial adverse interest in the disposition of such part of the income may be held or accumulated for future distribution to the grantor, or (2) may, or in the discretion of the grantor or of any person not having a substantial adverse interest in the disposition of such part of the income, be distributed to the grantor, or (3) is, or in the discretion of the grantor or of any person not having a substantial adverse interest in the disposition of such part of the income may be applied to the payment of premiums upon policies of insurance on the life of the grantor, such part of the income of the trust shall be included in computing the taxable income of the grantor.
(B) As used in this
Section, the term 'in the discretion of the grantor' means in the discretion
of the grantor, either alone or in conjunction with any person not having
a substantial adverse interest in the disposition of the part of the income
in question.
SEC.
65. Fiduciary Returns.
- Guardians, trustees, executors, administrators, receivers, conservators
and all persons or corporations, acting in any fiduciary capacity, shall
render, in duplicate, a return of the income of the person, trust or estate
for whom or which they act, and be subject to all the provisions of this
Title, which apply to individuals in case such person, estate or trust
has a gross income of Twenty thousand pesos (P20,000) or over during the
taxable year. Such fiduciary or person filing the return for him or it,
shall take oath that he has sufficient knowledge of the affairs of such
person, trust or estate to enable him to make such return and that the
same is, to the best of his knowledge and belief, true and correct, and
be subject to all the provisions of this Title which apply to individuals:
Provided, That a return made by or for one or two or more joint
fiduciaries filed in the province where such fiduciaries reside; under
such rules and regulations as the Secretary of Finance, upon recommendation
of the Commissioner, shall prescribe, shall be a sufficient compliance
with the requirements of this Section.
SEC.
66. Fiduciaries Indemnified Against Claims for Taxes Paid.
- Trustees, executors, administrators and other fiduciaries are indemnified
against the claims or demands of every beneficiary for all payments of
taxes which they shall be required to make under the provisions of this
Title, and they shall have credit for the amount of such payments against
the beneficiary or principal in any accounting which they make as such
trustees or other fiduciaries.
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 Harvard
Computer Systems, Inc. |
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