Compilation of Rules and Regulations of the State of Georgia
Department 560 - RULES OF DEPARTMENT OF REVENUE
Chapter 560-7 - INCOME TAX DIVISION
Subject 560-7-3 - SUBSTANTIVE REGULATIONS
Rule 560-7-3-.07 - Fiduciaries

Universal Citation: GA Rules and Regs r 560-7-3-.07

Current through Rules and Regulations filed through September 23, 2024

(1) Purpose. The purpose of this Rule is to provide guidance concerning the taxation of fiduciaries as required under O.C.G.A. § 48-7-22.

(2) Definitions. The term "fiduciary" shall mean the same as defined in O.C.G.A. § 48-1-2.

(3) General Provisions.

(a) The provisions of this Rule (relating to estates and trusts, fiduciaries, and beneficiaries) contemplate that the corpus of a trust, or the income therefrom is no longer to be regarded as that of the grantor. If, by virtue of the nature and purpose of the trust, the corpus or income therefrom remains attributable to the grantor, these provisions do not apply.

(b) In general, the income of an estate or trust for the taxable year which is currently distributed and/or distributable to the respective beneficiaries must be returned by and will be taxed to the beneficiaries, but the income of a trust which is to be accumulated or held for future distribution, whether consisting of ordinary income or gain from the sale of assets included in the corpus of the trusts, must be returned by and will be taxed to the fiduciary. However, regardless of whether or not the income is taxable to the fiduciary or to the distributee, the fiduciary is primarily responsible for reporting all income, allocation of the tax being affected by permitting the fiduciary, under certain circumstances, to show as a deduction the amounts credited or paid to the distributee.

(c) From the gross income of an estate or trust there are also deductible (in addition to the deductions allowed individuals) the following:
1. Any income of the estate or trust for its taxable year which is distributable currently by the fiduciary to a legatee, heir or beneficiary, whether or not such income is actually distributed.

2. Any income of the estate of a deceased person for its taxable year which is properly paid or credited during such year to a legatee or heir, and any income either of such an estate or a trust for its taxable year, which is similarly paid or credited during that year to a legatee, heir or beneficiary if there was vested in the fiduciary a discretion either to distribute or to accumulate such income.

3. Any amount described in subparagraph (3)(c)1. and subparagraph (3)(c)2. as being deductible from the gross income of the estate or trust shall be included in computing the net income of the legatees, heirs, or beneficiaries, whether distributed to them or not. In general there shall be taxed to the fiduciary:
(i) Income accumulated in trust for the benefit of unborn or unascertained persons or persons with contingent interests and income accumulated or held for future distribution under the terms of the will or trust;

(ii) That part of the net income of estates or trusts which has not been distributed or become distributable to the beneficiaries during the taxable year;

(iii) Income received by estates of deceased persons during the period of administration or settlement of estates; and

(iv) Income which, in the discretion of the fiduciary, may be either distributed to the beneficiaries or accumulated, to the extent not distributed during the taxable year. A net loss within a tax year substained by an estate or trust is a loss to the corpus of the estate or trust, and is not claimable as a deduction by a beneficiary of the estate or trust, unless otherwise provided for in the governing indenture.

(d) A deduction, in lieu of a personal exemption, shall be allowed to fiduciaries in accordance with O.C.G.A. § 48-7-26.

(e) The net income of deceased individuals who, at the time of death, were residents and who died during the taxable year or subsequent thereto without having made a return shall be taxed at the rates and in the same manner as living persons. A return for any year or period for which no return has been filed by the decedent prior to his death shall be made and filed by the executor or administrator of the estate of such decedent or the person or persons having charge of the properties of such decedent. See Rule 560-7-7-.08 as to the determination of the net income for the final return of a taxpayer who dies during a taxable year.

(f) A guardian, whether of an infant or other person, is a fiduciary, and as such is required to make and file the Form 500 Return for his ward and pay the tax.

O.C.G.A. Secs. 48-2-12, 48-7-22, 48-7-26, 92-3005, 92-3006, 92-8405, 92-8406, 92-8409, 92-8427.

Disclaimer: These regulations may not be the most recent version. Georgia may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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