Section 8166 - Income taxes(a) Receipts allocated to income.--A tax required to be paid by a trustee based on receipts allocated to income shall be paid from income.(b) Receipts allocated to principal.--A tax required to be paid by a trustee based on receipts allocated to principal shall be paid from principal even if the tax is called an income tax by the taxing authority.(c) Tax on entity's taxable income.--A tax required to be paid by a trustee on the trust's share of an entity's taxable income shall be paid proportionately: (1) from income to the extent that receipts from the entity are allocated to income; and(2) from principal to the extent that: (i) receipts from the entity are allocated to principal; and(ii) the trust's share of the entity's taxable income exceeds the total receipts described in paragraph (1) and subparagraph (i).(d) Reductions in receipts allocated to principal or income.--For purposes of this section, receipts allocated to principal or income shall be reduced by the amount distributed to a beneficiary from principal or income for which the trust receives a deduction in calculating the tax.2002, May 16, P.L. 330, No. 50, § 13, effective in 60 days.