54A:5-3.Ā  Taxability of estates, trusts and their beneficiaries
The income of a beneficiary of an estate or trust in respect of such estateĀ  or trust shall consist of that part of the income or gains received by theĀ  estate or trust for its taxable year ending within or with the beneficiary'sĀ  taxable year which, under the governing instrument and applicable State law, isĀ  required to be distributed currently or is in fact paid or credited to saidĀ  beneficiary.

The income or gains of the estate or trust, if any, taxable to such estate or trust shall consist of the income or gains received by it which has not beenĀ  distributed or credited to its beneficiaries.

Where an estate or trust has paid a tax under this act upon income distributed or to be distributed to a beneficiary, such beneficiary may excludeĀ  such income from his gross income in the year paid or credited to him.

L.1976, c. 47, s. 54A:5-3, eff. July 8, 1976, operative Aug. 30, 1976.
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