45 Ind. Admin. Code 3.1-1-13
Authority: IC 6-8.1-3-3
Affected: IC 6-3-1-3.5
Sec. 13.
Distribution Deduction of Distributable Net Income from A Fiduciary. A deduction for the distribution of net income is allowed for Indiana adjusted gross income tax purposes in the same manner as provided under section 651 and 661 of the Federal Internal Revenue Code. In the case of a "simple trust," the trustee is required to distribute all of its income currently, whether or not he actually does so. The distribution deduction is mandatory.
The distribution deduction as described in section 651 and 661 of the Internal Revenue Code is defined to mean that portion of the distributable net income required to be distributed to the beneficiaries.
When an estate or trust is to be closed, or is required to distribute current income during the taxable year and there is distributable net income, the distribution deduction must be taken and the distributable net income allocated to the beneficiary's Individual Adjusted Gross Income Tax Return, Form IT-40.
45 IAC 3.1-1-13